Distributing Wealth

Tonight’s Powerball lottery is worth ~$325,000,000. That’s enough money to go around. Did you bring enough to share? Win that lottery and you could give everyone in the USA $1, shipping and handling extra of course. We lose perspective on such large numbers. Join me as I dive into databases. (Make sure you check out the disclaimer at the bottom.)

Win Powerball and receive, over thirty years, 325 million dollars. If we colored in every state affected, then all fifty would be painted, and our territories would be too. We forget Puerto Rico too easily.

Win Powerball, take it all in one payment, and receive ~$202,000,000; which is about what Mitt Romney is worth. You could run for President of the United States, if you were born here and meet all of the other requirements. Finally you’d be able to either do things your way, or at least say you tried. Want to have more fun? Load up Stephen Colbert’s SuperPac with $200,000,000 and keep $2,000,000 for your more personal enjoyment. Or go back and pay $1 to every resident of every state except for California, Texas, New York, and Florida. The rest of the map would still cover a lot of land and represent a lot of people.

The poorest person on the Forbes list of the 400 richest Americans is worth about $1,000,000,000. They could give American $3. Forty of them could give every human $1. Eighteen of them could give everyone $2. Nine of them could give everyone $3. Bill Gates could give everyone $8.

So rich is rich, and it can spread a far way, but $8 doesn’t sound like much, unless you’re in one of the twenty five countries where the per capita income is less $1,000. A large portion of those populations could readily use $8.

But follow the story when we get closer to the middle.

The median net worth in America was ~$93,000. Start handing out dollar bills and forget the postage. Pick the right city and you can find 93,000 people within a couple of square miles. Charity begins at home, because sometimes that’s all the farther it can reach.

If it feels like your reach is far less than the Koch brothers (one is worth $4,000,000,000) don’t be surprised. Only about 80 Americans have greater wealth.

Net worth doesn’t get distributed this way, though I suppose someone could write that into their will. That would be interesting and entertaining. Most of the extreme net worth is tied up in investments, which would plummet if there was a massive sell order. Most of the moderate net worth, like those people around the median, are tied up in real estate; which is not exactly a happy market for sellers right now. (But buy my house for today’s zillow estimate of about $280,000 and I’ll be happier.)

Taxes must be paid, or accountants and lawyers hired to keep from paying taxes. Net worth numbers are rarely as useful as the same bank account balance.

And then there are the really big numbers. There are millions of Americans, but the US government operates on trillions of dollars every year. The 2011 Federal Budget, and yes I’ll capitalize Budget, was about $3,800,000,000,000. Did you notice that extra set of three zeroes? The Federal Debt is even bigger, $15,300,000,000,000. But then again, the US Gross Domestic Product is ~$14,580,000,000,000. I had to pause and count the zeroes because I didn’t believe it myself. Please double check. There are only ~300,000,000 Americans, and that’s counting the kids. We talk about unemployment so much that I have a hard time finding employment numbers. But it is the employed that are ultimately paying the taxes to run the government. Allow me to guess at about 100,000,000 workers and the individual worker’s load is $38,000 in taxes – that is if we were fully funding the government. But we’ve been spending more than we make for so long that our accumulated debt of 15 trillion dollars is $153,000 per worker. America’s possible saving grace is our GDP which is about the same as the debt, but we can’t use the GDP to pay the debt. What’s worrisome is that the median annual salary is ~$26,000.

I suspect that the enormous wealth and cash flow that is the US government is why so many wealthy people lobby to affect its spending. Of course, the idea of representative government is that the representatives should represent everyone, but that idea seems to be quaintly dismissed as impractical.

I draw some conclusions, but am more interested in playing with the perspectives and possibly sharing some insights. Each of us gets to draw our own conclusions. It is a free country, with some hefty price tags, maintenance charges, and cash flow possibilities.

There are an infinity of ways to slice such data. I don’t have a need for that. I stare in wonder at the situation. I will, however spend much more time wondering what to do with my lottery jackpot (because of course I will win, eh?) I’ve got a ticket that could pay $2,800,000 and another with better odds of paying $640,000. The latter is nearly “enough”. The former is more than “enough”. I can think of plenty of ways to distribute that wealth.

(Note: This is not a consistent set of data. I’m sure some government agency has everything available, but cruising their web sites is a contorted navigation through efforts at complete disclosure that are so pedantic that I’d have to understand their arcane language before getting a number. How many people are employed? It is easy to find the percentage unemployed but the simple number for employment is buried in some pdf or search string. That’s why I had to rely on wikipedia et al. Sorry for the inaccuracies, but hopefully the relative perspectives are correct.)

PS For a wonderful time, perusing such data, check out xkcd’s “cartoon” about money. I suspect he worked from a more consistent set of data – and style.

About Tom Trimbath

real estate broker / consultant / entrepreneur / writer / photographer / speaker / aerospace engineer / semi-semi-retired More info at: https://trimbathcreative.net/about/ and at my amazon author page: http://www.amazon.com/-/e/B0035XVXAA
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