DECEMBER 14, 2011 11:25PM

When you’re betting someone's salary, it's time to reassess

Rate: 10 Flag

 

$10,000 is a very popular amount right now. It's a nice round number: it can buy most people a more than decent vacation; it makes a nifty down payment on a house and hey, what else are you going to keep in your $5,000 purse?

$10,000, of course, was also the amount that Mitt Romney bet Rick Perry (even though it may have been illegal, oops) to prove that his Massachusetts health care plan did not mandate people to buy private medical insurance. Ironically, he would have lost.

Figure 1

 Credit: DailyCaller 

And who in the over-stimulated North America doesn't know about Lindsay Lohan who had her Chanel purse stolen a few days ago while vacationing in the beautiful state of Hawaii. She got her purse back alright, but her petty cash of $10,000 disappeared as quickly as her movie career. I'm assuming the money is currently being enjoyed by one of the 99%.

Figure 2

Credit: Wisdom Teeth Recovery

The obvious problem here is that for the fabled 1% (or even the 0.5%) income earners, 10K is easy money. They can afford to lose it if someone grabs their purse or if they think they have a better health care system than they actually do. But for a frightening number of Americans, this same amount of money is what they earn in an entire year, as seen in the figures below. And, in America, that means they live in conditions often as bad (or worse) than 3rd World Countries.

It's hard to see the beauty of our capitalistic system when it's not only caused these discrepancies in wealth but has produced people so inured to it that they don't even know the worth of the money they have. Mitt Romney's throwaway bet (or Lindsay's cash stashed in her purse) could probably buy all the tents for any given Occupy protest, which is one of the reasons the protests started in the first place.

Raw Income Distribution:

Figure 1   
 
 
Cumulative Curve:
Figure 4

Grouped Income Distribution:

Figure 5
  

Sources for the data:

U.S. Census Bureau (2009 data)

U.S. Department of Health and Human Resources (2009 data)

 

statistics for vBulletin

 

Author tags:

10 grand, 10000, betting, mitt romney, lindsay lohan, stolen purse, 3rd world country, annual income, poverty, occupy wall street, ows, rick perry, chanel purse

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Is there a slight uptick in that last bar graph at $250K. I was wondering what that meant. Do you know? I'd imagine it could mean “In this range, it's so easy to make money that if you fall into the next lower category, you quickly move out of it and up because it's hard to have ‘only’ that much for too long.” But I could be guessing wrong. Or even reading the graph wrong.

Interesting analysis in any case. Thanks.
Kent Pitman
December 14, 2011 11:56 PM
Kent,

Good question. However, I believe you may be on to something...

Thanks for your comment.
Kanuk
December 15, 2011 12:05 AM
$10,000 is close to what I pay out of pocket for health insurance for a year. (That's just the premium, not including the deductible and copays.) I'm glad that there are people in the country for whom $10K is a trivial amount.
mishima666
December 15, 2011 03:06 AM
Dunno about other people, but $10K is a substantial amount of money to me. As for Mitt/Rick show, it's like a couple of kids arguing "Oh yeah? I'll bet you a million gazillion dollars...." and just about as brainless.
Boanerges1
December 15, 2011 10:15 AM
Boanerges1: Oh yeah, it's also a substantial amount of money for me too (and probably 99% (!) of OS members).
Kanuk
December 15, 2011 11:27 AM
I'd bet 10K that if Perry had accepted the bet and then proven his point, Mitt wouldn't pay unless he could use money he scammed from somebody else.

I imagine that slight uptick in the last chart reflects the slightly larger number of above 250K incomes because, as the upper group, it's a catch-all. You could do a separate graph breaking down incomes in that group that would show a greater % of income difference than your graph on all incomes shows, methinks. You'd see that upper-atmosphere hockey stick pop up at the .001% end.

The problem with so much concentrated wealth is the cost of buying government is as much pocket change as Mitt's 10K bet, but it's a sure thing so it's not gambling.
Paul J. O'Rourke
December 15, 2011 11:55 AM
Paul: Me too, I would be surprised that Romney would pay.

Yes, for the graph, the last bar groups everyone above $250K. Unfortunately, I don't have the original data. The data provided or made available to public by the Census Bureau are grouped for specified ranges (as shown in the first figure).
Kanuk
December 15, 2011 12:22 PM
Mitt Romney is damaged goods, and so is the GOP. Rick Santorum may yet win the Michigan primary, which means that Romney would then officially be circling the drain. From the inside, the contradictions of the Republican Party are becoming intolerable. In fact the last time something as dire as that happened was in the late 60s and early 70s with the Democratic Party. Nixon beat McGovern 61-39. If Santorum were running against Obama, one poll says that Santorum would be 40 points behind.

In the cycles of American history, mainline parties periodically experience significant episodes of decay, which bodes quite well for the opposition. The emerging Democratic majority, big time.
old new lefty
February 26, 2012 01:38 PM