Sunday, December 04, 2011

the 1%

There was more outrage on NPR the other day about CEO salary (about $11 million on average for the 500 or so fortune 500 CEOs, according to AFLCIO), though the 400 or so NBA players (average salary to be $8 million in the current agreement) are feeling justified to go on strike. I couldn't find the numbers, but the top 500 movie and tv stars easily average above $11 million (Rupert Grint alone made $30 million).

I suppose it is no coincident that the philosopher most known for his defense of income inequality always used Wilt Chamberlain as his example, since people rarely begrudge the salaries of celebrities.

I feel compelled to defend the 1% because pretty much most of my friends if they aren't in that 1% now, will likely at some point be at or close to the 1% at some point in their life. The number people tend to use is $340,000 for joint household income in 2009. Or $170,000 per person in a two-earner household.

Also, someone who turns down a $200,000 a year to work for a non-profit or start a family should also properly be counted as earning $200,000 because by revealed preference, they are getting at least that many dollars of hedonic value from the less renumerative jobs they have taken.

I think few of my friends like to think about this fact. I agree it is somewhat troubling.

Also, that's just 1% of the US. To be in the top 1% of the world only requires $34,000 a year.

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