Britain Is Poorer Than Any US State (2014) | Hacker News Reader

Britain Is Poorer Than Any US State (2014)

forbes.com

77 pointsmonort100 comments

There's a documentary on Netflix about physicians setting up shop on a race track to offer treatment to the poor and indigent in Bristol, TN: https://www.newsweek.com/remote-area-medical-shows-what-amer...

You wouldn't see these scenes in even the most deprived corners of Newcastle-upon-Tyne or the Rhondda Valley. The crowds the event attracts! This is what a developing country looks like.

Ahh, HN, where someone doing a good deed is an illustration of how the United States is secretly a third-world hellhole.

What is the good deed you're referring to?

Is that a rhetorical question, or did you really not read the GP comment?

I did read, but didn't understand the parent comment. Apologies!

This shouldn't even have to be done is the point

Those are "my people" - I live in Arkansas, but my family migrated from Scotland to Virginia, through Kentucky and Tennessee, to Arkansas and southern Missouri.

Yes, there's a pressing need for better access to medical care, but I wouldn't mistake that for being "like a developing country". That area has a culture that's entirely different than most anywhere else, and the people are... well, "prideful" fits better than any other descriptor that comes to mind.

The average household income in Bristol, TN is $38,895, which is lower than the US average. The average household income in the UK is $32,247.

Stats are from statista and US Census. This 'third world' area in middle America is richer than the average household in the UK.

Nominally, yes, but you know, for $32K, you can rent a flat, eat healthy food as much as you want and maybe you can even save to travel and see different cultures once or twice a year. If you broke your leg, you don't have to worry about health insurance. I think that's fair. You won't go far earning almost just the national minimum wage in any country, but in the UK, you can have a very stressless life.

I think the sleight of hand here is that "Britain is poorer" reads as "the people of Britain are poorer" even though strictly speaking in GDP terms, Britain the country has a smaller market.

GDP is not wages. You can make tonnes of money in a company and none of it ends up as wages (just goes in the bank) so GDP is high but standards based on wages are no different.

As an example (I could be wrong - not an economist) but a single company making $1B more in one year would equate to a GDP/per capita increase of $10K in a town of 100K.

There are loads of places in the USA that looks desperately poor compared to everywhere I have seen in the UK so I can live with the headline as an economists click-bait.

So given this information as well as the UN report on US and the fact that the US is in poverty like conditions [1] I think it’s safe to say everyone is broke.

This post from reddit on /r/funny isn’t funny - it is the truth [2]

[1] https://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?N... [2] https://www.reddit.com/r/funny/comments/9fq5e4/the_simpsons_...

Inequality is one thing, but the US is still a wealthy country.

> a wealthy country

Who is the country in this context though, does GDP mean the people are wealthier?

The wealth of a country is a question of what resources it has, public and private, not how they are distributed. Saying that "everyone" is broke misses the point that it's inequality that is getting worse.

There are certainly problems in the US, but that UN report is a joke. It perpetuates the nonsensical reporting about poverty in the US in which poverty is measured before taking into account most welfare assistance. With that methodology you could allocate twice as much money to welfare assistance and the "poverty" rate wouldn't budge.

Here is a bit of a take down on the UN report: https://www.manhattancontrarian.com/blog/2017/12/21/the-mali...

Median adult wealth in the UK is almost double the US (https://en.wikipedia.org/wiki/List_of_countries_by_wealth_pe...). This article is somewhere between methodologically lax economics and UKIP drivel.

You're confusing wealth and income. Americans earn more but save less.

I'm not -- the article is making this mistake. Your second sentence is precisely my point.

Ahh, Tim Worstall, senior of the Adam Smith Institute and former press officer for UKIP.

I can stop at the byline to avoid his unusual approach to economic fact.

GDP per capita per hour worked is a better metric to use when comparing countries. Most Western European countries have fewer hours worked per worker, but when they work have the same productivity. I'm not sure about the gini coefficient, but both of the numbers given seem low. The US's was over 0.42 from what I've read in other sources.

> GDP per capita per hour worked is a better metric to use when comparing countries.

Comparing what? Wealth? Efficiency? Happiness? Athleticism?

If you are comparing economic well-being, use GDP per capita. If you worked one hour today and $100 or eight hours and got $100, either way your richness/poorness is $100.

If you are comparing efficiency or something, do the per hour thing.

It would be interesting to have a metric that is a combination of economic well-being and quality of work.

Ie, in your one hour vs eight hour example; CountryA on average works much much less, but has the same GDP as CountryB. This would seem like a very meaningful metric for the success of the country, one that GDP would obscure entirely.

Though perhaps hours work plays into one of the other quality of life style metrics, in which case perhaps it's already covered.

I don't know any of this stuff, just commenting as a spectator :)

I’m sure we’d all vastly prefer to be the person who works an hour for $100 and has the rest as free time. If those two people have equal “richness” then the term is not very useful.

If you're suggesting that wealth/income is different than quality of life, I would have to very strongly agree.

I’m going a bit further and suggesting that free time ought to be incorporated into “wealth” somehow. After all, time is money.

The great depression had a lot of people with a lot of time. "Rich with time", you might say.

That’s why I want to incorporate free time into “wealth,” not replace it altogether.

When basic necessities are met ( infrastructure, health, sanitation, education, food, housing, security) there are diminishing returns for an individual to work harder. I'd also add that per capita is a bad measure because of the skewed income distribution. Median is a better metric here.

> If you are comparing economic well-being, use GDP per capita.

If you want a simple unidimensional measure, either median personal income or median household income (each has pros and cons) per capita is a much better GDP per capita; GDP per capita tells you the ratio of aggregate output to population, but nothing about economic well-being of the people in the economy.

It wouldn't hurt to look at more than one number and consider, say, the 20th and 80th percentile as well as the median.

This seems to be on the right track. How about asking the question... How many hours does the median wage earner have to work to earn the cost of living? (food, housing, transport ion, etc.)

So what this article primarily shows is that "wealth" (as measured by PPP-corrected median per-capita GDP) isn't that relevant a metric for measuring anything except "wealth". Of course the not-so-subtle implication is that "wealth" is intrinsically "good" and that income redistribution has not achieved "good" (although the final remark in itself is a silly cum hoc ergo propter hoc and in itself reveals the biases of the author).

Few people disagree that the median purchasing power in the US is greater than in Europe; the real question is "so what?"

What this shows me is how misleading comparisons like this can be. I think the UK has been brought into US politics over the last few years, and living in the UK it's funny how far from the truth some of the claims made can be. I'm sure the same goes in reverse though.

Most of Europe actually. I was reading a piece I believe CATO put out about this recently.

Ah yea, CATO. I’m sure they haven’t twisted the numbers to make Europe seem like a socialist hellhole and America the land of the free and the rich, despite half of America barely able to afford necessities and one accident away from complete bankruptcy.

Why would you read anything from CATO?

Because they put out well written, well researched and thoughtful scribs I can read while smoking my pipe?

Because they tend to release detailed, well sourced, and accurate articles?

They actually don't do any of that. Can you link me to 1 article that matches all of your own criteria? Bonus points for that article withstanding the test of time.

Sure they do! I would just refer you to the CATO site to have your pick of thoughtful, well researched articles. Now you run off and have a read and come back with a link if you find a specific article that doesn't meet your specifications.

>I would just refer you to the CATO site to have your pick of thoughtful

Link 1.

Here. Top of the page.

https://www.cato.org/publications/tax-budget-bulletin/tax-re...

I look forward to hearing what’s missing from this extremely detailed, 98 citation article.

You mean the 63 citations that are either quotes from news articles or referrals to sister publications? And the rest are just citations to vanilla data?

It's interesting that citations for their actual claims/arguments are completely missing like this:

>Although California is viewed as having perhaps the nicest weather in the nation, it has suffered from domestic out-migration for many years.

>A tax increase in one jurisdiction may cause an initial out-migration to other jurisdictions.

>An income tax increase in a state may cause individuals to out-migrate over time.

>High earners are often entrepreneurs, and they may move their businesses and related jobs with them when they migrate.

>The capping of federal deductibility has increased the state and local tax bite on millions of households in high-tax states. At the same time, today people can easily find information to compare state tax burdens.

CATO is a think tank in the most oxymoronic sense. Fuck off with that "omg big number citation" non-sense.

I'm also curious why you wouldn't read anything from CATO.

Because it's an ideological propaganda mill that is only helpful (in terms of necessary time investment for any given level of confidence) in arriving at the truth on any issue, compared to ignoring them completely, when dealing with their admissions that are contrary to their overt bias, which are infrequent enough that reading their output is a net loss.

That said, it's still better than Heritage.

"All that redistribution hasn't made the Nordic poor richer than the American poor but it has made the rich poorer."

I'll take issue with this - the poor in Nordic countries and Britain have a much stronger social safety net. So maybe a better conclusion is that in Britain they are still as poor as before, but with access to similar health care as the rich (who are slightly less rich to allow for this).

It sure doesn’t seem to be reflected in how people live. Is this just using the wrong measure for “poorer”?

Universal debt is a hell of a drug.

Yes, GDP per capita is a measure of aggregate output relevant to population, not wealth (which is a stock and not a flow) and not living standards (which are a flow, but not the same flow). Even with PPP adjustment it doesn't measure common living standards, because it doesn't distinguish between broad and narrow distribution.

Median income measures are better for standard of living comparisons.

My economic knowledge is lacking, how good of a metrics is PPP?

Specifically this jab:

> showing that the bottom 10% in the US have the same incomes (yes, PPP adjusted) as the bottom 10% in either Sweden or Finland. > While the top 10% have very much larger incomes than the top 10% in either country. > All that redistribution hasn't made the Nordic poor richer than the American poor but it has made the rich poorer.

If PPP is a good metric, that would mean there are about the same percentage of people starving and lacking medical care in the US as in Nordic countries. That is incorrect if general media portrayal is correct.

This story validates what I felt when I lived in the UK several years ago during research. I felt the country had so much money (London) but everyone lived so poor.

I was getting paid basically the same numerical value as I had been in the US, but all the prices were in pounds.

And the cars were so old, like twice as old as typical cars in the US.

I wondered where all their tax money was going -- and I figured to the poor north of the country.

Yet people in the UK generally behave so well, and are polite, and are educated and proud. This is really impressive -- the power of social psychology in the face of measureable economic deprivation.

Or maybe it's going towards health care, education, and social services. What a concept

Not even. Reading their news about NHS, all they talk about are cuts and the controversies of having to ration service based on postcodes.

He should remove the outliers and study those separately. The gini consideration goes a bit in that direction, but not far enough. Possibly even split the population in 4-5 buckets: from people under the poverty line through to the extremely rich and then compare each of those. Admittedly, this would be way harder but would paint a much better picture.

This Wikipedia page may also be of interest. It has two lists: 1) median household income, and 2) median adult income.

https://en.wikipedia.org/wiki/Median_income#Gross_median_hou...

Also this list of countries by income equality: https://en.wikipedia.org/wiki/List_of_countries_by_income_eq...

It's a bit weird that the author acknowledges the difference between UK regions and London, promptly ignores that, then continues to adjust the US figures by the different PPP figures by state. It definitely makes the whole thing a lot less apples to apples.

Also, the cost of goods and services being cheaper in the US might not be a strictly good thing. If food, clothing and haircuts are only cheaper because businesses are employing people on well below a living wage, or exploiting cheap labour from undocumented immigrants, then it's hardly something to celebrate.

On that last point: "the bottom 10% in the US have the same incomes (yes, PPP adjusted) as the bottom 10% in either Sweden or Finland. While the top 10% have very much larger incomes than the top 10% in either country. All that redistribution hasn't made the Nordic poor richer than the American poor but it has made the rich poorer". I'm not sure of the details, but it's easy to see how that would be misleading if those income figures don't account for government transfers from rich to poor, or nationalised/socialised state services in health, transport or education.

The question is, will Brexit help or hurt with this? Will Britain be better off than the rest of Europe as a result of leaving the EU, and how long will withdrawal pains last?

Decades and they won’t be, unless they don’t want access to the EU market for their goods. Best case they have to follow all EU law and have no say in the matter.

Not surprising.

The whole place is basically a big rust belt. Industry is dead, martitime doesn’t generate a lot of jobs, the US captured tech, and banking produces money but not employment.

This article keeps talking about mean GDP.

Unless you live in a perfectly communist society, mean GDP is a poor proxy for how wealthy the people in it are.

Additionally, if the author wants to adjust for PPP, they should also adjust for cost of healthcare, education, median transportation expenses - all of which are much higher in the US. (All right, median transportation expenses may be higher in the UK. I honestly have no idea.)

Also, it's worth considering how much GDP in each country is spent on projects that don't improve anyone's life. If half your GDP is spent on building tanks and submarines and nuclear weapons, while your people want color TVs and washing machines, or a health system that won't bankrupt them, it's often not the best use of your economic output.

>healthcare, education, median transportation expenses - all of which are much higher in the US.

Transportation by car costs dirt in the US. Transportation by rail isn't so much higher to make up for how dirt cheap it is to go places in the US by car when compared to Europe.

What a load of tripe. The sheer level of hand-waving in their calculations makes their bias pretty clear.

How do other European countries compare?

Off topic: What is this form of title when they add stuff like "Yes, Even Mississippi" which doesn't add any value? Is there a term for it?

Why would you say it doesn't add value? It doesn't add factual information but that isn't what a title is for.

I'm tempted to classify it as an instance of the logical fallacy appeal to emotion.

Thank you, I think that's what I was looking for.

In this case, it kinda does add something. The post is a reaction to a magazine article which states the UK is poorer than all states except Mississippi..

If you read the article, the author was commenting on another article that made a claim that the UK compared unfavorably to every state except Mississippi. So, it does add value, it's stressing that by some particular metric the UK compares unfavorably "Even [to] Mississippi."

and Brexit hasn't arrived yet...

Switzerland isn't in the EU and is doing fine.

Switzerland poverty rate - 6.6% Germany poverty rate - 16.7%

Source: https://www.indexmundi.com/factbook/compare/switzerland.germ...

Britain is certainly not Switzerland.

Source: I'm British.

I'm going to assume you're not British / European, but for the record Switzerland is in Schengen and EFTA, Britain is heading for being in neither.

Britain is already in neither; it's never been in Schengen, and left the EFTA when joining the EEC as the EU was then. Although the other 3 countries in EFTA are part of the EEA (edit: which is how they're part of the single market), Switzerland isn't. Instead, they participate in the single market via a bunch of bilateral treaties:

https://en.wikipedia.org/wiki/Switzerland%E2%80%93European_U...

I know. That wasn't the point.

> Switzerland isn't in the EU is doing just fine.

That's a bit like saying getting divorced is easy because other people enjoy single life.

Switzerland, having never been in the EU, has long-standing trade/customs/etc. deals in place.

The UK, having been in the EU, now exits without extant trade/etc. deals with anyone, as setting them up on an individual basis while part of the EU wasn't permitted - the EU negotiates them as a single entity.

"In the US food is generally cheaper than it is in Europe, medical care generally more expensive."

I'm not sure when medical care is cheaper in the US. Within the VA system, maybe?

Also, the ranking does not stack up against wikipedia figures:

https://en.wikipedia.org/wiki/List_of_U.S._states_by_GDP_per... https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)... (Where PPP is already accounted for, so this guy is doing it twice).

UK would come in ~35th. Similar to Nevada or Michigan.

The author is saying that the medical care is more expensive in the US, not cheaper.

> I'm not sure when medical care is cheaper in the US

You literally just quoted the article saying it's more expensive in the US.

> In the US ... medical care generally more expensive

generally = sometimes it is less expensive. I guess it wasn't clear, but my point was that healthcare is on average much more expensive in the US.

Reply on news.ycombinator.com