Wealth Not Subjective


By Rachel Simons

Photo courtesy of Fibonacci Blue.

In 2011, the protest movement Occupy Wall Street launched in New York City’s financial district. Though protesters have vacated Zuccotti Park, Occupy Wall Street has left an impact on American vernacular in the popularized phrases “We are the 99%” and the one percent. However, the distinctions between economic classes are not so easily perceived.

In a country with an estimated population of over 320.5 million people, only one percent of Americans actually considered themselves to be upper class. This number may match up with general perceptions, but it doesn’t necessarily ring true when considering the actual wealth brackets.

Although the cost of living may vary state to state, studies show that if a household makes more than $250,000 a year, it is richer than 97 percent of the national population. When President Obama declared a tax raise on any income made after that mark, the upper middle class voiced their outrage. They claimed they didn’t deserve to be taxed more because they didn’t make nearly as much as other wealthier citizens in slightly higher tax brackets.

Of course, this argument may seem preposterous to anybody with a much lower income (the 2015 federal poverty guideline for a family of four is an income of $24,250 or lower), but it does beg the question: What makes Americans who are really on top of the wealth pyramid think they are poor or not well off?

The answer has to do with the human psyche and group dynamics. A 2010 study conducted by Princeton University claims quality of life does not improve once a person surpasses a yearly income of $75,000. However, other findings show that how rich a person feels isn’t based off how much they objectively earn, but how subjectively wealthy they are in comparison to their peers.

Since people tend to gravitate toward others of similar interests and backgrounds, wealthy people surround themselves with other wealthy people, altering their perception of wealth. So, for instance, a family of four living in Connecticut with a yearly income of roughly $250,000 are objectively wealthy. But, if their neighbors or friends purchase a better home, a new car, or a new boat, their wealth seems lesser in comparison.

These incorrect perceptions become an issue in the realm of politics and social policy. Similar to the public outrage against against the Obama Administration for increased taxes, the upper middle class is capable of, and has the means to, make their voices heard. As such, the upper and upper middle classes help dictate social policy in America.

Additionally, those with higher income tend to be less empathetic and altruistic than people within lower income brackets. Furthermore, a British study conducted in 2010 found that, on the whole, society is becoming less sympathetic to the social inequalities and issues that cause people to become poor. Instead, the public is merely blaming the poor for their station.

Although it may be easier to group the US’s population into the one percent/99 percent dichotomy, that breakdown doesn’t account for the intricacies in the distribution of wealth in this country. If the US is to help the poor and lower income, the inaccurate perceptions of wealth must first be corrected.