The American middle class has slid down to the level of the global middle class, and the American upper class harvests profits from the entire world outside of America's borders.
Which is not true. The average American earns more than the average European, let alone the average global citizen. Heck, even construction workers in the US make way more than in Germany or Denmark.
Americans still have the highest purchasing power in the world and, most importantly, the highest economic mobility in the world.
Whether that leads to a higher quality of life is up to the individual but Americans are still some of the most priviledged workers worldwide.
The difference is that citizens of the EU don't die when the money stops flowing because there are multiple social insurances in place.
So at least the reduction of income that is insurance should be considered a wrong measurement, because it's taken off before taxes.
I totally agree with you there. Here in Germany, most homeless people could not even start to work because you need a legal residence to get a bank account (getting paid in cash or via check is illegal in Germany), so they cannot accept the Arbeitslosengeld (Hartz IV).
There are some initiatives in larger cities though where they provide shelters so that homeless people can have a legal postal address to get back on their feet.
This is not specific of Germany/EU, and it's actually a principle of pretty much of any society. Countries can't just give away residence and money for free. If one belongs to EU, getting residence is easy; if not, the visa conditions apply. Therefore, you're talking about illegals (and/or refugees), which is a different matter.
It's actually funny (in a tragic way) that countries like Germany or France took the highest number of refugees during the crisis (official stats: https://ec.europa.eu/eurostat/statistics-explained/index.php...), and citizens still complain.
In other words, ironically, countries may as well block entrance to asylum seekers, or throw homeless away out of the borders, and the public opinion will be negative regardless.
Those people that lost their home and would theoretically be willing to work still cannot; hence because they don't have a postal address which is required to get a bank account.
Since the new Zahlungskontengesetz was established, all people that have a German citizenship have a right to get a Basiskonto [1] and banks must comply.
Though the legal loophole here is that getting a bank account still requires a postal address.
That's incorrect. You can collect Arbeitslosengeld II ("Hartz IV") in cash at the local job center, no bank account required.
First off, that's not the default. So statistically this isn't true.
Second: The Finanzamt and the GwG would have a different opinion about that, see [1] and [2] (pp. 10 and pp. 11) regarding that.
I personally know somebody who did collect it in cash in the past, got sued by the Finanzamt, and lost in front of the court (ironically with a Bargeldstrafe).
Also note that even the SGB 2 and 3 make this very clear, without room for interpretation, that you need a bank account [3] (pp. 43). The only theoretical exception would be if the costs for a bank account would require more than 100 bucks that you are legible to get in advance per month [4] (pp. 43a) but that's pretty much impossible to prove without having a bank account in the first place.
[1] https://www.gesetze-im-internet.de/gwg_2017/__10.html
[2] https://www.gesetze-im-internet.de/gwg_2017/__11.html
Bulgaria is very poor (average yearly wage USD3600/year), but they still have: Universal Health care (though there is a fee of USD 0,62 per visit), children under 16 are free. Maternity allowance, with extras for e.g. twins, disabled children and mothers currently studying. Social benefits like guaranteed minimum income (though very low) and unemployment benefits. And state pensions.
¹ (in Romanian) https://www.cursvalutar.ro/blog/ajutorul-de-somaj-ce-este-cu...
Regardless, my skew is apparently more off the mark than I recalled as another poster pointed out.
[1] https://www.diw.de/documents/publikationen/73/diw_01.c.53312...
EDIT: The publication isn't the newest, being from 2016.
https://dqydj.com/average-median-top-household-income-percen...
So... you are correct?
This part stopped being true at some point in the 21st century. The slowly shrinking disconnect between reality and this belief is imo the most powerful political force of our day.
https://en.m.wikipedia.org/wiki/Socioeconomic_mobility_in_th...
https://www.nytimes.com/2012/01/05/us/harder-for-americans-t...
Of course, besides convincing people that it's possible you need to have an economy that makes it possible. So that would be the second step.
https://en.wikipedia.org/wiki/Global_Social_Mobility_Index'
As someone who has gone from the bottom to top quintile, I think this is a very interesting and sad aspect of American life. Especially how it is perceived vs the reality.
Are you in the US? Because only there you have such high mobility. Good luck getting in the top quintile in Europe if you were born in the bottom. That is what real economic mobility looks like.
Sure, Europe does better in these statistics, but in the real world, US gives its workers way better odds at getting to the top and that's coming from an European.
Just because statistics say you shouldn't be poor doesn't mean you can't be poor. Just because statistically there is no racism in your area doesn't mean you won't get discriminated and deprived of opportunities.
Because the when certain metrics are used to compile a formula that leads to any ranking, then those parameters are subject to gaming in order to meet an expected result so those statistics are meaningless at the end of the day when you can't move past a certain wage/social class due to the artificial barriers set by a feudal leadership.
Statistically, the unemployment rate in my country should be about 2% while realistically it's much higher since the government doesn't count certain classes of people in odder to make the numbers look god in statistics for the EU.
Anecdotally, my acquaintances who emigrated from the former soviet bloc to North Ameriac and Australia ended up with much more wealth to their name including their own houses vs the ones who moved to Western Europe who basically ended up as serfs to be renters for life.
Do you see the problem with statistics as evidence? They don't tell the whole story.
It's difficult to generalize the wealth of Europe, so this is not strictly wrong, but it's not strictly correct, either.
Northern countries (at the end of the spectrum, Scandinavian nations) are typically far richer and with more stable job positions than the eastern/southern.
Rich country != rich citizens.
Look at Germany, it's the country and the mega conglomerates with their executives that are rich. The median wealth of Germans is among the lowest in EU:
https://www.piie.com/sites/default/files/images/f/kirkegaard...
Although I checked the data here: https://en.wikipedia.org/wiki/List_of_countries_by_wealth_pe... and it agrees more or less with that graph.
That's so weird and totally non-intuitive. I wonder what the cause is?
EDIT: It seems income inequality isn't so bad, but wealth inequality is. https://en.wikipedia.org/wiki/List_of_countries_by_income_eq...
I guess this is due to low rates of home ownership in Germany causing wealth to be concentrated among relatively few landlords?
If you can't afford a home, it means your income is not as high as you thought.
Take the bottom 50% (or whatever) in generation A. Count what percentage of their children end up in the top 30% (or whatever). Thats' mobility. And it's highest in Northern Europe, by any reasonable standard.
Except that this isn't true. You are basing this assertion on mobility indexes which account for more than this raw mobility. It's the reverse. By raw mobility, the US does outperform Europe. But, importantly, and accounted for by the indexes are referenced in the follow-up comment to your other respondent, people in Europe do not backslide between generations the way they do in the US. Europe has higher economic stability, but lower mobility, due to broader social support systems and much more heavily progressive taxation.
Any study that goes back before WW2 shows a different story in the US, and that's partly because post-WW2 was a major economic shift between the US and Europe, and also because the US has to account for its (relatively short) history of discrimination affecting economic mobility, especially in the South.
A more honest take is that economic mobility is different in both places based on various demographic factors /other/ than economics. If you're college educated and white or college educated and an immigrant your economic mobility in the US is very high, if you are not college educated or not white (but a non-immigrant) your economic mobility in the US is very low. In the EU there is less disparity, but less overall mobility, which can be accounted for partly by the broader parts of society receiving higher education, and partly by the more progressive taxation which prevents massive jumps in wealth accumulation and is used to ensure a higher minimal standard of living for the poorest in society.
In Australia, laws are very biased to the landlord (despite the opinions of Australian landlords). It's an absolute pain in the arse to rent there.
In Germany, laws are very biased to the tenant. Renting is a totally viable option, people can and do rent their entire lives.
I've lived in both, and seen people trapped in shitty mortgages in Australia because they didn't want to rent, spending half their lives commuting to work. And people paying tiny rents in Berlin because they started the rental contract 10 years ago and the landlord can't raise the rent.
My awesome German GF just got us a new 3-room apartment at 900/month in Wedding. I was paying roughly that for a 1-room shitty flat in Perth a few years ago during the "rental boom".
If you are hard-working and talented, this might skew your view about mobility in the US/EU.
I know what you mean, it's harder to get "rich" in Europe, but in terms of going from lower class to middle or upper middle class I think that's easier to achieve in Europe compared to the US.
At that point why compare to the US though? If the comparisons exclude former communist Europe and poor Mediterranean Europe from then why not exclude rust belt American and Appalachia from comparisons?
I disagree. Italy is typically included everywhere - it's a G7/G8 country, with a GDP bigger than Canada or Australia, and trumps Spain on pretty much any indicator (let alone Greece). It has its problems but it's not a poor or bankrupt country by any means.
> At that point why compare to the US though? If the comparisons exclude former communist Europe and poor Mediterranean Europe
In terms of population, the EU as a whole is 30% larger than the US. It's somewhat inevitable that there will be some pruning when trying to compare apples to apples. It's just a fact that Eastern Europe is not representative of the larger Union any more than, say, Mississipi, Oklahoma or Alaska are fundamentally representative of the whole US.
Why do think, then, that there are so many homeless people in the US? They aren’t all mentally ill or drug addicts.
But your chance of success is basically none in half of the EU. Even homeless people in the US have a much better chance, because they have access to the US market.
If you're not mentally ill or a drug addict, good luck getting someone to think otherwise and give you a job.
I remember this story of this homeless man with an amazing voice. Some radio host gave him a job, it looked like a success story and after a few months he lost everything again due to his addiction
This has happened many times and continues to happen. I know a number of people who have done exactly this, and a few of them now own multiple properties. They also send money back to their families in their home countries.
Good luck trying to do the same in the US. If the rents in white collar areas don't kill you, the healthcare costs will.
Also, all bureaucratic issues with the banks and local authorities for setting up a business if you're self employed are also not done in English but in the local language.
Try getting a blue collar job in Germany, and I don't mean a barista in a hip touristic district where all clients are foreigners. You're expected to pick up the local language yesterday.
The US having English as the default language everywhere means much less friction for everyone including foreigners be them employees or entrepreneurs.
There's certainly less language friction in the US.
But there is far, far more economic and class friction.
And most people can pick up the basics of a language.
Edit: In general, I won't disagree with you that language is a real barrier for employment in EU.
Not as true as you might think. I’m from the UK originally, live in Berlin now, and while I can do a lot with English, there are doors closed to me by not being C1/C2-level German.
(I have of course been doing online language courses for ages, but as the locals say: Deutsche Sprache, schwere Sprache.)
But that's - what - the top 5% of jobs?
What you said is true about tech but a plumber or electrician that crosses borders will start at square 1. They will have to fulfill the licensing requirements in their new jurisdiction. These requirements almost always include requirements that add up to where one must work under person holding level V license before taking test W and then work X years before obtaining license Y which lets them be responsible for work type Z and there will be a corresponding requirement that all job Zs be performed by a party with license Y.
Professional licensing requirements like this are why you have experienced oral surgeons from Taiwan slapping braces on teenagers in California and expert boiler welders from Vietnam building hand railings in London.
This quote screams brainwashing by American media to me. Americans (and those that consume their media) are told from childhood that they are the only country where it is possible to move from the bottom to the top. Outside observers can clearly see that this is not the case, but when presented with hard evidence to the contrary it is simply dismissed as some untruth without any critical thought.
I don’t love that WEF study and I could spend a lot of time picking nits with its methodology, but for the sake of argument, let’s accept it as broadly true.
Why do Americans believe what we do? It is partial brainwashing by the media. But it is also a very real national story of immigration for economic activity.
The foreign born population of the United States is currently around 40-50 million the majority of whom are citizens or permanent residents. That’s a lot.
New York is a representative gateway city. The percent of the population of New York City which is foreign born was 36% in 1900. It was also 36% in 2000. These are people who came here for economic opportunity. Their lived experience is that the US afforded this opportunity. Now certainly the US isn’t the only country that offers such an opportunity, but we’ve been doing it for a while. We’ve had waves of immigration come from Eastern Europe, Southern Europe, Ireland and the U.K., East Asia, South Asia and Mexico, Central America and the Caribbean.
My grandmother came as an immigrant from Germany, off a farm with a grade school education and worked as a nanny on the Upper West Side of Manhattan. I now live on the Upper West Side and my kids nanny from Guyana got her citizenship about five years ago. (And she literally lives on the same block in Queens my Scottish grandmother did when her family came over.) And there’s nothing special about my story. It’s fairly typical.
That report cited in the parent shows a statistic that it would take on average 5 generations to move from the lowest income group to the median. I have no reason to doubt it. But I believe that largely is a story of slavery, racism, Jim Crow and the economic backwardness (until they 1970’s) of the American south. It’s shameful. You can understand why we might not want to celebrate it, preferring to look at the voluntary immigrant story.
And another observation that makes this obvious to me is the sheer amount of options/companies here for every little product and service vs back in Europe. Which was quite overwhelming when moving to the US but it is a good problem to have, more options and choices is always good IMO.
Unfortunately, this is incorrect. If we are to believe the OECD [0], the US have near the lowest economic mobility of any developed country.
[0] http://www.oecd.org/unitedstates/social-mobility-2018-USA-EN...
Is this based on data or a is it a generalized assumption?
A short time ago, on HN, there was debate about the exactly opposite argument - that the purchasing power significantly decreased¹.
[¹]: The Life in The Simpsons Is No Longer Attainable, https://news.ycombinator.com/item?id=25570611.
So even if they are making more money, I don't feel like it adds to their wealth or their lifestyle, which was kind of the point of making more money isn't it?