In short, the comparison with 36 nations included, shows that the US stands even worse, relatively speaking, than in the 19 nation comparison. The numbers show that many nations with recent and current severe banking/financial problems still have median wealth numbers that greatly exceed ours.
These include: Italy, Belgium, Iceland, Ireland, and Spain. The first four show more than double the median wealth of US adults and the last has a 40% greater median wealth figure. The US Fed is being called upon to use US nominal financial resources "created out of thin air" to bail out the financial systems of these nations, and will probably continue to provide such backing to "save the financial system." The irony of our doing that when we refuse to use vigorous fiscal policy to help our own middle and working class people to remain employed, get new jobs, and work for a living wage, is another of those outrages to our democracy we experience every day.
The mean-to-median ratio numbers are also interesting to say the least. Nations with a ratio under 2.00 include Australia, Luxembourg, Italy, Japan, Ireland, Spain, Malta, Slovenia, Brunei, and the Bahamas. A majority of nations have ratios between 2.00 and 3.00. Nations over 3.00 include: Switzerland (5.35), France (3.25), Norway (4.07), Israel (3.25), Germany (3.49), the US (4.71), Sweden (6.56), China (4.88), and Denmark (9.30). So, the US is among the most unequal nations in the world on this measure. Among the nations that exceed it in inequality, the numbers for Sweden and Denmark may be statistical artifacts. The World Bank Gini number for Denmark is 24.9 and for Sweden is right behind at 25 with Norway coming in at 26, while the Gini is 41 for both the US and China, and 34 for Switzerland. This suggests that there may be something about the way welfare state transfer payments are accounted for that doesn't get into the Credit Suisse Median Wealth per Adult statistics. Wigwam suggests:
"One of the anomalies in this data is that personal retirement plans (e.g., IRAs) usually count toward "net worth," while general retirement plans (e.g., a public employee's defined-benefit plan and/or Social Security) don't. I'm told that Sweden and Denmark have excellent plans that take care of the elderly. Not only don't those plans count toward their citizens' "net worth," but the excellent quality of those plans encourage their citizens not to save. If you had super-excellent government coverage to care for you in your elder years, would you set aside as much as the typical American? My point is that the median American is really at the bottom of this graph."
Finally, I think the Credit Suisse Report gives the best picture yet of the failure of the US political/economic system to progress as rapidly as the systems in other modern nations. The jingoistic beating of our chests, insisting that the US is "the richest nation in the world", with an unequaled political/economic system, just doesn't square with reality. It may make a great many Americans feel good. But it's not true and it doesn't help us to face and adapt to our circumstances. In the end "all life is problem solving;" and you can't keep on living well if you won't recognize and then solve your problems.
Our system hasn't produced the advantages for most Americans that other systems have produced for the citizens of their nations. How long will we continue to deny this in the face of mountains of cross-national data, and instead insist that our way is best? It may be best for 1% of us, but for the overwhelming majority, it is close to the worst among advanced modern industrial nations. Other nations produce better health for their citizens, healthier children and seniors, better education for their citizens, better work lives, less stress, more happiness, low cost universities. You name it; they've got it!
What we've got, instead, is an ideology about the free market that works for very few of us and makes the rest us less free, less wealthy, less secure, and less happy, as time goes on. Our economic system isn't delivering for us. Our political system isn't delivering for us either, it's corrupt through and through, and our leaders won't prosecute the rampant control fraud in the financial sector. And, finally, all we get from our representatives is excuses and rationalizations about why we can't adapt to the changes, we, ourselves, had a great part in bringing to the world.
So, what can we do about it? I'm afraid this post isn't about that. But, I think what we have to do is to create a new web-based Information Technology platform we can use to create a meta-layer of political activity that will take control of the major parties and either make our representatives accountable to the 99%, or replace them with new people who will be responsive to them. I've written about this a number of times previously. See here, here, and here, for example; and yes, it can't be done in time for the 2012 election. Sorry about that, but what we have to do can't be done in three months, and we should have started doing it three years ago if we wanted to be ready now.
That ends the previous post. Here's the conclusion.
The Significance of Variations in Median Wealth Per Adult for Net Median Income Per Capita
Median Wealth Per Adult isn't a direct measure of Net Median Income Per Capita. In fact, if we had a better measure of Net Median Income Per Capita, than Median Income Per Capita after taxes, we'd probably want to use it to test to see whether stagnant Net Median Incomes Per Capita after taxes lead to rapid declines in Median Wealth Per Capita. That is, to see whether trends in the flow of income impact stocks of wealth.
Lacking such a measure, however, and assuming that where the US stands on the stock of Median Affluence is more important in the first instance than where it stands on the flow of Median Income, it's hard to avoid the conclusion that Median Wealth Per Adult is a better indicator of relative affluence of the middle class than Median Income Per Capita after taxes. Since that's the case, it's hard to justify all the attention this study is getting from the MSM and a good part of the blogosphere.
It's now old news that the United States has been surpassed by other nations in Median Wealth Per Adult, and as my post shows, its Median Wealth Per Capita was less than 25% of Australia's while the distribution of wealth in the US is far more unequal than the distribution in that and many other (including other English-speaking) nations as measured by the ratio of the Mean Wealth Per Adult to Median Wealth Per Adults.
So, one question which immediately comes to mind is if that's old news, then would we not expect that such a result could only have happened if the United States had long since lost its lead in what I've been calling Net Median Income after Taxes, since that kind of result in Median Wealth Per Capita could have come about only primarily through an accumulation of Higher Net Median Incomes Per Capita over a period of years? If so, then the real news from the Times Report is that Median Income Per Capita is just a poor measure of affluence and has propped up the notion that the US middle class is especially affluent long past the time when this ceased to be the case.
In other words, the Times Report says more about the shortcomings of The Times when it comes to economic analysis, than it says about the real changing position of the US Middle Class when it comes to affluence. Oh, and to underline the point, the above table suggests that Canada hasn't just passed the US relative affluence of its middle class, but that this happened some time ago, since in 2011 Canada's Median Wealth Per Adult exceeded the US's by nearly $36,000 per adult, or by roughly 69%, a change in relative affluence that had to be developing over a relatively long period of time, long before The Times decided to proclaim this as "news."
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