I've never been poor in the terminal sense, but there was a time when I had no money. I wasn't desperate, and I was beginning a career with a lot of promise, but I was also too proud to ask for help from friends or family.

During that time my car broke down, and it would cost $3000 to fix it. This was money I didn't have. The car was otherwise reliable, so overall it would have been a good financial decision to fix the car that would have provided me with more than $3000 worth of transportation amortized over its future useful life.

But that didn't matter, I couldn't afford to fix it.

I did need a car though, or I couldn't get to work. What I could afford was to take out a loan to buy a used car, even though that used car was not as reliable as my previous car and cost more than $3000.

I ended up getting the used car. My decision to do that was based on my need to get to work and keep my job. It was the right decision, but had I had an extra $3000 in cash, the right decision would have been to fix my otherwise reliable car.

People without extra cash are constantly one misfortune away from a downward spiral.

That is a falsifiable statement, you know.

Is there any statistic to show what percentage of today's top 1% earners where born to a bottom 50% family from the previous generation, and viceversa? If less than what you would expect from two non-correlated random variables, this suggest where you start in life has an effect of how far you can go. This does not invalidate your hypothesis, but may suggest that upwards mobility takes more than one generation to lift people from poverty to wealth.

Further more, we can do the same analysis to figure out how many people from bottom 50% families grow to reach 75% percentile or above. I do not know what it would be, but if much lower than expected, that would suggest that upwards mobility is quite limited, invalidating your hypothesis.

You seem to be talking about average wealth and social mobility. This is different from inequality, which is about the distance from the bottom to the top.

Some of these results are counter intuitive. For example: There's data to show that the top quartile of earners in low inequality countries live longer than their top quartile counterparts in high inequality countries, even if the high inequality counterparts earn much more both in absolute and relative terms.

Edit: Since this is getting downvoted, here's a talk that spends 17 minutes listing studies showing that this is in fact about inequality, not average income. https://www.youtube.com/watch?v=cZ7LzE3u7Bw

Right, I have seen that research before, and I don't think you should be getting down-votes either.

The relevance of social mobility in the discussion was because the GP assumes the correlation that the problems related to inequality/poverty is the result of a third factor that is cause of the other to: personal choices.

My position is that if this is the case, we should be observing strong social mobility in both ways. Surely there are a number of "deserving poor" that started life in a disadvantaged situation but are able to lift themselves out of that by intelligent choices and hard work, as well as there are privileged folks who make enough ill choices and land themselves in trouble.

IF this is not the case, we should adjust the level of agency that people are capable. To what degree is it personal choice able to influence the well being we enjoy in life.

> If less than what you would expect from two non-correlated random variables, this suggest where you start in life has an effect of how far you can go.

Where you start in life is not independent of innate traits.

Agreed. But if that's the case, how (or to what degree) can inequality be the consequence of "one's own chosen behavior".

If, for example, things like impulsiveness and self-discipline (cough Conscientiousness cough) have high degrees of heritability, it can be simultaneously true that one's birth place correlates with one's destination and it also be the consequence of one's own chosen behavior. (And to the extent that the environment is equalized and optimal, genetic factors will matter more, not less.)

It's usually people who have never been poor that think that.

(I've been poor. I don't think that.)

Same here! I find that when you spend the time to actually inspect this concept of 'chosen behavior', it usually turns out to be much less chosen than it initially seems.

Don't get me wrong, in some ways my opinions on the issue enter the very sensitive topic of genetics. I'm by no means a 'fluffy lefty' who believes education solves everything.

But the mere fact that I need to point that out bothers me. From my perspective, without even getting into genetics and whatnot, the 'chosen behavior' thought in regards to the poor is mostly bullshit. Being poor sucks, and a big part of that is a consequence of the fact that society penalizes poverty. Merit doesn't really enter the equation.

It's a privilege argument. I'm getting very sensitive to privilege issues lately.

I lifted myself out of poverty. I grew up in what southerners call "white trash" (albeit upper middle white trash), and my father was more or less a petty criminal. But I'm well aware that being white, male, smart, and American all contributed heavily to my success. I'm the beneficiary of privilege.

Far, far too many people (and you can see it in this discussion) were born on second base and think they hit a double.

Indeed, the City of Ferguson's finances relied on the regular fining of its poorest citizens. Basically backdoor taxation.

Not unlike the lottery, which the poor regularly spent their meager pittance on. Taxation of the poor as Lincoln noted.

So can be ban lotteries (and casinos, too) unless participants demonstrate they can afford the losses?

Since you mention it: http://www.theatlantic.com/business/archive/2015/05/lotterie...

Lotteries are a symptom of the problem of poor financial education. Lottery-funded scholarships are the only way a lot of kids get to college. Ban the lottery, and their parents will blow it on something else. That something else will probably not allocate most of its funding to scholarships.

edit: If this country were rational enough for the solutions proposed in replies, we wouldn't even be having this conversation.

You don't need lottery-funded scholarships if you have universal education (as most first world countries do).

> Taxing innumeracy seems a good start.

Taxing based on wealth instead of intelligence just seems more....civilized?

"The measure of a civilization is how it treats its weakest members."

"The measure of a value judgment is whether it is enclosed by quotation marks"

Old saw: if you want less of something, tax it; if you want more of something, subsidize it.

Or, alternately, we should be funding that education by taxing companies who will ultimately be consuming those employees anyways.

>>Not unlike the lottery, which the poor regularly spent their meager pittance on. Taxation of the poor as Lincoln noted.

Not sure if you're trolling. Assuming you aren't, allow me to point out that your analogy is ridiculous. Fines are mandatory: you have to pay them or you face stiffer fines, and even jail. Lottery is completely voluntary. No one is forcing them to play.

Actually, the two are very related. While one is bound by law enforcement and the other is a "voluntary expenditure" they both accomplish the same goal, taxing those who have the least to give.

And while we are involved in a discussion of human psychology. Maybe consider the mental aspects of extreme poverty and you can see that purchasing lottery tickets is not exactly voluntary but a desperate attempt to change the course of an exasperated existence. Just a thought.

For example. Drinking water is voluntary but if you go without water you might get the feeling it's a little more than a choice...

>>Actually, the two are very related. While one is bound by law enforcement and the other is a "voluntary expenditure" they both accomplish the same goal, taxing those who have the least to give.

That's literally the only common thing between them. This doesn't make them "very related." It makes them tangentially related at best.

>>For example. Drinking water is voluntary but if you go without water you might get the feeling it's a little more than a choice...

Wow, so now you're comparing purchasing lottery tickets to drinking water. Amazing.

It'd be funny and practical if money invested in lotteries never resulted in a large win but was later returned to the participant - like a surprise investment scheme.

Sure, but that's not a particularly interesting or useful observation seeing as how one's choices are a result of economic circumstances.

large scale inequality is the symptom of lack of social mobility. If poor people are able to work hard and become rich, there wouldn't be such large difference in wealth.

Inequality starts from inequality of opportunities.

I think it was Warren Buffet who said something along the lines of: if we handled the Olympics the way we handle wealth, we would be looking for the grandchildren of medal winners in the 50's and 60's and sending them to compete today.

Your environment restricts your available choices and these things are tied back on themselves, so behaviour creates an environment that then influences behaviour. Looking for ultimate causes in current behaviours for social systems that have developed over evolutionary timescales is pretty pointless.