I Am the 99%. How About You?

For the past few days, I've been trying to wrap my head around what it is -- exactly -- that protesters are trying to accomplish with their "Occupy Wall Street" demonstrations.

Even the man responsible for starting the protests, Adbusters Editor-in-Chief Kalle Lasn, wasn't quite sure what the rallying cry would be. "The demand could be some stupid lefty thing like 'overthrow capitalism,'" Lasn said back in September. "We're hoping it's something specific and doable.”

Now in its third week, this nascent movement seems to have found its motto.

"We are the 99%"
In case you’re wondering, if your household takes in less than $1.5 million per year, you, too, are in the bottom 99% of income earners, according to statistics from the Tax Policy Center.

Protestors point to data like this -- from the Center on Budget and Policy Priorities -- to demonstrate their anger. The chart shows the share of income growth that was captured by the top 1%, and the bottom 90%, of wage earners over several time periods.

Source: Center on Budget and Policy Priorities.

Of course, there are varying explanations for this stunning reversal: the growth of the global economy, the outsourcing of American jobs, and the development of labor-replacing technology among them.

Understanding the situation, the protesters' concerns, and their detractors' counterpoints leads me to a quandary.

Caught between a rock ...
At its root, I don't think people are protesting solely because they're jobless, or have lost their homes. These things happen.

Here's my theory: I believe the problem is that we detest large disparities (of any kind) within groups. And there's no reason not to feel this way: We're hard-wired for it.

If you were to create a timeline of humanity's existence on earth and put it on a football field, the amount of time that we've been living in civilizations -- roughly the last 10,000 years -- would be equal to a golf ball. The other 99% of the time, we survived in tribes.

Our psyches haven't evolved out of this yet: We are designed for tribal living.

One of the tenets of tribal existence is interdependence between the individual and the tribe. Sure, there is a social order, but all experiences are shared. When there’s a drought, everyone -- from tribal leader to newborn -- must cut back on food.

It's not that it would be cruel not to feed others in your tribe. It's that it would be suicidal. Everyone relies on everyone else. This is the framework we are born with.

... and a hard place
But trying to re-create society in a tribe's image would be akin to putting toothpaste back in the tube; it can't be done. We know all too well what happens when communism is given a try, Americans are tepid at best when it comes to socialism, and we've enjoyed far too many fruits of capitalism's efficiencies to throw it out the window.

What, then, are we left to do?

It's all about education
In an essay he penned this summer, reflecting on the country's downgrade from a AAA rating, founding Fool David Gardner asked, "Which message do you hear from your state government more often? Is it (a) financial literacy is a critical study -- a gift even -- for our youth, and we are every day testing and graduating kids who know what they're doing with money, or (b) 'You could be next. Gotta play to win' ... your state lottery?"

As David pointed out, "A nation of financially illiterate citizens who are democratically electing their government seems to me to be hoping for lottery odds that things will 'all work out.'"

What's more is the fact that learning how to wisely handle finances is usually far easier than the trigonometry or chemistry we require all students to be proficient in upon graduation.

From where I sit, educating our nation's youth (and a large portion of its adult population) in economics would address the protesters' concerns on two levels.

Taking responsibility
First, citizens would be forced to accept personal responsibility for the decisions they have made. Too many times, I've seen signs and heard interviews with protesters clamoring over the loss of their houses.

Certainly, some banks have fouled up the foreclosure process, but that doesn't change the fact that the end result was inevitable.

While I can certainly sympathize with their plight (I bought a condo at the height of the bubble that's fallen significantly in value), no one held a gun to anyone's head and forced them to make purchases they shouldn't have been making in the first place.

Holding Wall Street accountable
Furthermore, becoming educated about economics and the stock market is about more than simply making money; it's about being part of the decision-making process -- or at least it should be.

If you have money in a mutual fund, a retirement plan, or even a pension, it's highly likely that you are actually a part owner in several companies. But because you've turned that money over to the "pros\" to invest for you, you've essentially forfeited your right to vote on company issues.

Managing an entire portfolio isn't for everyone, but should you chose this path, you are part owner of a company; with that designation, you have a say in things like corporate governance and executive compensation. Fellow Fool Alyce Lomax has written extensively on how shareholders can demand that boards straighten out their crooked policies.

Follow through!
But all too often, even those of us who do manage our own portfolios simply shrug our shoulders when it comes to corporate governance. I've thrown more proxy statements in the garbage than I can remember; I'm not sure if I've opened a single one.

But imagine if all the teachers and firefighters and factory workers and writers (and anyone else who directly or indirectly has money in the stock market) devoted the same amount of time voting on corporate measures as we do on following our favorite football team.

I'll bet there'd be a lot more model CEOs like Apple's (Nasdaq: AAPL  ) late Steve Jobs, Google's (Nasdaq: GOOG  ) Larry Page, or Whole Foods' (Nasdaq: WFM  ) John Mackey -- who all took in salaries of $1 recently.

I also bet there would be far fewer severance packages that bordered on insane, like the one Leo Apotheker got at Hewlett-Packard (NYSE: HPQ  ) or Baxter Phillips received when Massey Energy was sold to Alpha Natural Resources (NYSE: ANR  ) .

In the end, all of us -- the 1-percenters and the 99-percenters -- must find a solution. Because as Nobel laureate Joseph Stiglitz tells us:

The top 1 percent have the best houses, the best educations, the best doctors, and the best lifestyles, but there is one thing that money doesn't seem to have bought: an understanding that their fate is bound up with how the other 99 percent live. Throughout history, this is something that the top 1 percent eventually do learn. Too late.

Fool contributor Brian Stoffel encourages others to share their thoughts below. He owns shares of Apple, Whole Foods and Google, and can be followed on Twitter at @TMFStoffel.

The Motley Fool owns shares of Bank of America, Apple, Google, and Whole Foods. Motley Fool newsletter services have recommended buying shares of Apple, Google, and Whole Foods, and creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On October 10, 2011, at 4:41 PM, DJDynamicNC wrote:

    "While I can certainly sympathize with their plight (I bought a condo at the height of the bubble that's fallen significantly in value), no one held a gun to anyone's head and forced them to make purchases they shouldn't have been making in the first place."

    This is true. Nobody held a gun to their head. Instead, they struggled to make sense of complicated financial instruments and, failing to do so (while juggling a job or two, a kid or two, a dog or two, and if they're lucky, a hobby or two), they turned to the financial experts for advice. And these experts sold them products that the same experts turned around and bet against on the market, likely that very day.

    Does this describe everybody in this situation? No, surely not. But a significant chunk of these people were just doing what capitalism tells you to do - pay money to an expert to handle a task you don't have the time or interest in mastering yourself. And those experts took advantage of that system for their own gain. Blaming the foreclosed families for being lied to by the people they relied on for financial expertise is like blaming a rape victim for letting the crime happen.

    The thing about the 1% is, most of them don't seem to be any smarter or more accomplished than the rest of us. Indeed, many of them appear to be essentially incompetent. So while you're right that their fate is bound up in ours, and in a very real sense they need us - the wage earners and labourers and backbone of society - it's also worth pointing out that we don't particularly need them. The jobs they do - and frequently do so poorly - are jobs that could be filled by any of the less fortunate but equally (if not more) capable of us. As those who rose from the working class, like Bill Gates, Larry Page, and Warren Buffett, amply demonstrate.

    The rest will apparently need to be taught that lesson.

  • Report this Comment On October 10, 2011, at 4:56 PM, Tim1T wrote:

    Brian, makes some useful comments about how each of us can do more to be accountable for the problems on Wall Street. But a huge part of the anger at Wall Street goes beyond the large salaries.

    The other half of the issue has to do with the fact that our country is still in an economic crisis caused in large part by the financial institutions. And Brian says nothing about the fact that these big investment companies were never really held accountable.

    The fact is that these big companies sold these packaged mortgage investments to unsuspecting clients and said that the underlying mortgages were safe bets. That was a lie.

    These guys made huge bonuses even while their companies were getting bailed out by taxpayers.

    Their sleazy approach drove the entire world economy into a ditch. And even folks like me that avoid investing in banking stocks like Goldman had our 401k's lose tremendous value.

    Personally I don't think there would be such pent up anger at Wall Street if the top paid of these sleazy bankers had been sent to prison instead of being given bonuses.

  • Report this Comment On October 10, 2011, at 5:22 PM, SpaceVegetable wrote:

    Thank you! Finally someone pointing out that personal responsibility has a place in financial decisions. The thing that has bothered me most about these protests is the passing of blame onto everyone else instead of people taking responsibility for their own decisions, bad or good.

    Some of the economic ignorance I've seen is astounding. So many don't know even the basics of how the economy and finance work. This leads to people who can be easily misled by a bunch of half-truths and flat out misinformation that they don't have the ability to verify due to lack of knowledge.

    Sure, the corporations aren't blameless in the financial crisis, but they are not the only ones. Politicians and individuals share plenty of responsibility, too. This radical fringe claiming to represent all of us in the 99% really has a lot to learn. Life isn't fair. The real world doesn't grade on a curve and you don't get a trophy just for showing up.

  • Report this Comment On October 10, 2011, at 5:23 PM, Darwood11 wrote:

    Unfortunately, no one is holding the politicians and government policy makers responsible, either.

    The fact is, the last 10-20 years were epitomized by greed coupled with an entitlement mentality.

    I'm part of the "49 percent" which is paying for the benefits of the "51 percent."

    America is today struggling with a huge drag, which includes millions of people who never finished high school, millions who are living on entitlements, and millions who are a part of the "health care bubble" that's strangling this country.

    Wall street and the bankers did not create any of this.

    I think the rabble which named themselves "occupy [this]" is very well named, They are squatters. It's particularly galling to see the unions once more jump into the fray. Trick question: How many of you out there got a "signing bonus" of $5000 this year just for deciding to show up at work another year?

    I understand there is a lot of anger out there. My children at the age of three would throw temper tantrums from time to time, particularly when they were told "no." So it is with adults in America, today. We can grow up, but that doesn't mean we will be responsible or accountable for our personal actions. I see ample proof of this each and every day.

    In 2005 when Katrina hit New Orleans, I used it as a bullet point and my position was "we are a NATION of Katrina victims. And so we are.

  • Report this Comment On October 10, 2011, at 5:38 PM, SpaceVegetable wrote:

    @Darwood11: You are so right. Katrina should stand as a shining example of the dangers of depending on the government (or any old "someone else") to take care of you.

  • Report this Comment On October 10, 2011, at 6:40 PM, JustinMatt wrote:

    Personal responsibility for investing?? what rubbish, maybe you'd like to buy my Financial Corporation of America shares from me for $5000??

    That's worthless fraud from the Savings & Loan 1980's crisis in case you didn't know your history.

    the 1% is nothing more than cheaters and thieves who deserve prison or indictment!!

    Your chart glossed over the period 1930-1960 when those Depression survivors wanted nothing to do with deregulation or financial crisis.

    All things were carefully regulated then and people didn't lose their savings! and the traitors, cheaters and thieves like the Koch brothers, ALEC, Republicans, wall street hedge funds went to JAIL. period.

    Scandinavian countries have free health care and their governments protect their taxpayers from fraud!

    They don't suffer from the same nonsense created by our past 40 years of foolishness. Not only do we need enforcement of wall street regulations but also strict Federal regulation of insurance companies which does not exist.

    Tell me that lack of access to health care insurance isn't tantamount to a death panel? It is rationing whether you choose to believe that or not!!

  • Report this Comment On October 10, 2011, at 8:04 PM, Homecooken wrote:

    Where are the positive stories about the Tea Party on The Fool?

  • Report this Comment On October 10, 2011, at 8:18 PM, 1984macman wrote:

    Mr. Stoffel, you left out the most glaring reason for the ascendancy in the wealth of the few and the decendancy in the wealth of the many - the end of the graduated federal tax. The tax burden on the middle class has increased year by year as inflation drives more and more of us into that upper tax bracket, while the wealthy can earn more and more because they're already in the upper tax bracket! In effect, the wealthy already have a "flat tax".

    We need tax fairness in this country, and that means that the wealthiest need to start pulling more of the financial load. We need to reinstate the graduated income tax, although this time we need to tie the brackets to the rate of inflation. Only then will we see the middle class become revitalized.

  • Report this Comment On October 10, 2011, at 9:07 PM, Bert31 wrote:
  • Report this Comment On October 10, 2011, at 9:23 PM, borninthematrix wrote:

    This is by far the worst article I have read on Motley Fool. Normally the articles stick to non political ideas.

    Yes people need education and to use their heads, but we expect a fair playing field in America and we expect the government to enforce rules to keep it fair. I have worked all my life and paid my bills. I bought a house and lost most of the equity that i put into it. Was that because of my lack of education or because people were allowed to make ridiculous balloon loans that drove up the price of homes for us all and now we all having to pay. Who profitted from this process. Weren't the people making these loans educated enough to know that these people would never be able to meet the balloon payments? Or did they only care about the bonuses they received? Your article is crap. The people that profitted from these loans acted criminally. We should recover the money and put them in jail. Then we won't have the issues again. Would we.

  • Report this Comment On October 10, 2011, at 10:33 PM, Tomohawk52 wrote:

    The real estate bubble up here in Canada is inflating thanks to ZIRP and the citizenry have learned zero from the lessons of our brothers to the south. When it eventually pops I predict all sorts of protests featuring "how was I to know?" and "well X told me that real estate only goes up...". It's true that many of these bankers should be in jail, but it is also true that when every second show on TV has someone adding a fourth bedroom and a third bathroom for $75K and the house's value climbs $150K, you have to question whether everyone has just gone totally bonkers with greed. It happened with Nortel, it happened with the dotcoms and it will probably happen again with social media. How to stop people from losing their minds? I wish I knew...

  • Report this Comment On October 10, 2011, at 10:47 PM, zgriner wrote:

    The 50's and 60's were an abberation. The US was the only industrial nation left, and was able to reap the rewards while Europe and Japan rebuilt.

    During the last 20 or 30 years, we gutted our manufacturing industries and off-shored them. That's where the middle-class existed and their jobs. Where else could a high school graduate get a job making an above average income with no formal education?

    Every talking head excused this industrial decline by claiming that we were moving to a high-tech services economy. Well, these services need educated people. Unfortunately, our politicians keep paying welfare to women to bear idiots who disdain education. So, we invent visa programs to import educated people from around the world, while we keep paying more and more into welfare. Many of these educated people go back to their countries to start industries to compete with us, or to undermine us.

  • Report this Comment On October 10, 2011, at 11:11 PM, devoish wrote:

    If you want a more objective picture of what OWS is about, I think you should look at TMFBanes links.

    http://caps.fool.com/Blogs/free-us-from-debt/653624

    Best wishes,

    Steven

  • Report this Comment On October 10, 2011, at 11:46 PM, vinceli wrote:

    The 1% are not only rich but they look out for each other. The %99 are all pulling each other down. Its amazing that unions are blamed, they say unions have become a political force but isnt the whitehouse owned by corporate and foreign lobyists anyway? How I wished my job had a union, I have a masters degree, military experience, I only have one credit card, a 15 year old paid off car yet all these still isnt enough to make it in America today. Would be nice if we had a union in our company to protect us. I can understand if people get cut due to performance (I'm all for competition) but when companies are just cutting due to off shoring then who else would you turn to than unions?

  • Report this Comment On October 11, 2011, at 12:10 AM, SpaceVegetable wrote:

    Unions are responsible for a lot of offshoring in the first place. If you were a business, who would you rather hire: cheap foreign workers or expensive, demanding union workers who constantly extort you for more by threatening strikes? Seems simple to me.

  • Report this Comment On October 11, 2011, at 12:52 AM, TMFCheesehead wrote:

    @DJDynamic-

    Totally fair points. I think though we may be at slightly different points on the spectrum, we would both agree that a more financially literate populace (read: that includes Congress) would help us all to demand very specific, actionable things from those who we wish to hold accountable.

    @Tim-

    You're right, I didn't mention how those who got bailed out weren't appropriately held accountable. I guess part is because almost 30 months have passed since the onset, and I'm trying to look forward at how to improve.

    Although I'm not crazy about backwards looking punitive actions (as a rule, not having to do with finance solely), I certainly will agree that a lack of some form of culpability will teach future generations the wrong lessons.

    @Darwood and @SpaceVegetable-

    I'd encourage you to check out Brian Richards take on his visit up to NYC. There's a wide mix of people participating, from the "squatters" to those who have some very solid points.

    http://www.fool.com/investing/general/2011/10/08/the-3-smart...

    @1984macman-

    How many voters out there truly understand the tax code? I think financial literacy needs to come first, then demanding an overhaul follows.

    Brian Stoffel

  • Report this Comment On October 11, 2011, at 2:46 AM, cattywampus wrote:

    Here is an interesting video about the tribal behavior model. It is by Jeremy Rifkin and titled "The Emphatic Civilisation"

    www.youtube.com/watch?v=l7AWnfFRc7g&NR=1

  • Report this Comment On October 11, 2011, at 4:18 AM, MichaelDSimms wrote:

    I am also in the 99%. However we live in a country where it's always someone else's fault for your misfortunes. I believe the protesters are looking to blame someone for there troubles. Sure I would like to blame stock brokers they make lots of money. But don't hate the player, hate the game, it's the rules that need changing and they are made in Washington D.C.

  • Report this Comment On October 11, 2011, at 7:00 AM, dstwhit wrote:

    Excellent article, Brian. I love your focus on what we can do next--the blame game doesn't accomplish anything productive and we each have something we can do to contribute to improving our economy one "starfish" at a time. So as a starter, I have forwarded this to my kids and will discuss it with them and become more proactive in educating them on their financial choices and destinies.

  • Report this Comment On October 11, 2011, at 9:31 AM, Tygered wrote:

    I agree. Sex education and Financial education should be requirements in all schools, yet we teach neither. These are the two most basic things we need to know in how to live.

    I do disagree about the housing. Surely people should know what they can and can not afford, but it is incumbent upon the bankers to provide guidance. When a bank doesn't even ask to see payroll statements or tax returns, you can NOT say the banker is blameless. I place about 70% blame on the banks and 30% upon the borrowers.

  • Report this Comment On October 11, 2011, at 10:06 AM, lemny wrote:

    Education is a nice safe broad solution but investing is a risky business. So many of us have had the luxury of losing money and learning from our mistakes but many of the 99 will not venture into risky waters - they're sold on safe saving practices.

    Just losing a small amt on MCI has kept me out of stocks for years. Diversification and Managing Risk must be what I need to learn. It's time I sell some of my mutual funds and get back into stocks.

  • Report this Comment On October 11, 2011, at 10:12 AM, TMFCheesehead wrote:

    @lemny-

    I agree, it can be risky business. I would argue, though, that education is about empowerment. As David Gardner mentions, more financially literate voters will probably demand economic solutions that are far more viable than what we sometimes get today.

    Brian Stoffel

  • Report this Comment On October 11, 2011, at 11:01 AM, Tiingall wrote:

    I'm all for accountability and educating our children about how to minimise the impact of future financial scams by the banks and finance sector. No doubt many of us Fools - along with many people amongst the OWS protesters - have lost a lot of our hard earned savings over the past three years.

    Apart from those of us who's pensions have evaporated, or the value of the shares that help create those pensions have gone south, there are all the people who have lost jobs, homes and for many of them hope in their future.

    And along with it, they have lost faith in the institutions that we've all been educated to believe are there to help us, if we also help ourselves. We've believed in saving, investing and putting money aside. But we've been deliberately deceived by the people we were taught we could trust with our savings.

    The banking and finance industry is certainly one of those foundations of society which we were educated to believe we could trust. It was supposed to be run by responsible and conservative professionals who thought first about protecting our savings we entrusted to them. They told us they could be trusted to responsibly manage our savings, which when aggregated, creates the nation's accumulated wealth.

    That accumulated wealth is not something the banks or financiers created; it is the savings created from the labour of the 99%. It is the excess income generated by all the little people who labored to create, construct, distribute, promote and sell products and services to others. We - and the company owners - gave our savings to the so called responsible professionals in the banking and finance industry to prudently invest and husband, so we'd all have a little more in future, something to pass to children, something to live off in retirement, something to help pay for medical expenses, a vacation, education for our children etc.

    The sad fact is the so called professionals in the banking and finance industry betrayed us. They were not responsible, professional or trustworthy. Instead of being thankful for our money we gave to them to manage - and which created their jobs and salary - they betrayed us. They put their personal greed light years ahead of their professional responsibility and any sense of ethical behavior or duty to the people who's money they were trusted to manage.

    They created deliberately flawed financial products - including scam housing loans for people who were predictably going to have trouble with repayments - in order to justify great salaries, bonuses and commissions for themselves. They took our savings from their vaults and vaporized it, so they could get rich quick with no concern for the victims of their scams, or the depositors who's money they used to fund their scams.

    If we go to the bank and borrow other depositors' money for a business idea and it goes bad, the bank staff who gave us that loan - and got a great commission for doing it - want to take our home, and other assets to get back that borrowed money. We are accountable.

    But when the bank staff borrow depositors' savings from the vault and invest it in a business idea - so they can get a great commission for being so smart - that goes bad, they can walk away, without replacing our depositors' savings. They keep the house, yacht, foreign bank account and other assets they bought with their ill-gotten income created by the predictably flawed investments they fabricated, promoted and sold.

    Accountability needs to run both ways. Those of us who created the savings have lost big time. We have paid the price for trusting the bakers. But the bankers and financial wizards have walked away laughing at us. They do not need to return our savings, or sell their homes to replace our depositors' money that should be in their vaults.

    The people in the streets are there because they have lost faith in the financial institutions and the people who were supposed to be responsible, accountable and trustworthy. The people in the streets were content to be the workers in a symbiotic relationship, so long as they could have a reasonable life and retirement, and were shown some respect. Ripping them off is not a sign of respect.

    They have waited three years for the banking and finance institutions to show remorse, to demonstrate regret, to apologize, to throw out their bad eggs, to rid themselves of the ploys and scams that can be used to do it again, and to sell the ill-gotten assets and return the money hidden in overseas bank accounts; to put back their hard earned savings in the vaults. But the bankers and financial wizards have chosen not to do so. They have instead demonstrated they are not responsible, professional, trustworthy or accountable. And they have shown no compassion or respect or remorse for the people who's savings they contrived to take or vaporize.

    And while I'm sure the politicians are not without guilt, we did not entrust our savings to the politicians. We responded to the bankers and finance "professionals", and chose to give them our savings to manage, responsibly. We did not give our savings to the politicians.

    The bankers chose to exploit the flaws in the law for their own greed. They could have acted professionally, ethically, responsibly, to protect the interests of their clients. But they chose not to do so, in a big way.

    And like true psychopaths, they have shown no remorse or guilt or attempt to make amends for their despicable actions that have created immense human suffering on a worldwide scale.

    So with their back is against the wall, and nothing else to lose, and little prospect of an improved future, desperate people resort to desperate measures.

    I would not try to dismiss or write off or ignore or explain away the actions of the OWS protesters. They are the early wisps of smoke from a smoldering fire. Ignore it and it's likely to become an inferno.

    A regularly repeated pattern in USA history is the inability to sense a problem and take remedial action before it's too late. Or maybe it's the ostrich approach to problem solving. History shows that eventually, the ignored issue and the people it impacts will create a movement that changes the shape of everything; perhaps violently.

    The people of the OWS movement are crying out for help, for restitution and for changes to stop it happening again. To ignore or belittle them is to light a fuse.

    Read the signs before it's too late. The number of victims of this latest foray into insatiable greed is growing daily. These victims have been patient for three years, but little has changed.

    When we all work hard to replace our savings the bankers' vaporized, they'll find another way to do it to us again. Our shares prices will plunge again, and our retirements will suffer, along with the futures of our children and the children of the OWS protesters. We are in the same boat.

    That's why these people are on the street; politely. It's time to listen and to act; before desperate and ignored people reluctantly conclude that being polite is not working.

    The OWS protesters don't need to be eloquent orators. The bankers and finance wizards of Wall Street need to be smart listeners. There are ample matches, guns and lumps of timber available if the protesters feel they remain ignored, as they have for the past three years.

    Our share prices will absolutely plummet with the onset of widespread civil strife. But the bankers and financial wizards who took or vaporized our savings, ruined our share prices, and destroyed the social fabric of the USA, will be OK.

  • Report this Comment On October 11, 2011, at 11:08 AM, TMFCheesehead wrote:

    @Tingall-

    Wow, that was an excellently written, even and fair assessment of the situation. Thanks for sharing!

    Brian Stoffel

  • Report this Comment On October 11, 2011, at 11:26 AM, catoismymotor wrote:

    99% may control 35%-40% of this country's wealth, but so what? You can either wallow in your current station in life or you can plan your way to a far better future.

    TMF is here to help you invest in yourself and your future. They even help with ideas for your kid's financial future. Use this site and others along with time honored books by Buffett, Fischer, Graham, Hill, Lynch and other authors to get started. Many can be found at the library.

    You and I may never make it into the top 1%, but I don't care. There is still 60%-65% of loose wealth rolling around for us to take advantage of. That is more than enough to help me realize my goals.

    And don't give me any crap about not being able to find a job. If you are without kids or unmarried you can take a crappy job making minimum wage at Burgertown and a second job doing something else to get by and maybe even put something aside for saving and investing. It is really important to land a job. It's easier to move on to the job you want if you currently hold a job.

  • Report this Comment On October 11, 2011, at 11:30 AM, catoismymotor wrote:

    Argggh! I meant to say: 1% may control 35%-40%...

    Thank, God. It's almost time for lunch.

  • Report this Comment On October 11, 2011, at 1:14 PM, XMFScott wrote:

    I'd be interested in seeing the graphic showing absolute growth rates in income for the different time periods for the same segments

  • Report this Comment On October 11, 2011, at 6:03 PM, cattywampus wrote:

    Great response Tiingall, I agree that both sides need to take responsibility. No one held a gun to the heads of the financial institutions and forced them to buy the credit default swaps and risky derivatives. My anger would boil it down to a case of callous ignorance or vicious negligence. The institutions seem to act with a lack of morality or concern for the pain and suffering that they have inflicted on their fellow human beings. Anger as we know is not a constructive path or a civilized solution. It feels good to expel the venom though and move on to seek an understanding of this on going dilemma.

  • Report this Comment On October 12, 2011, at 5:34 PM, DJDynamicNC wrote:

    Brian, I'm sure you're right, both that we likely fall at different points on the spectrum but also that enhanced financial literacy - particularly in Congress - could only improve the picture.

    Here's an idea - and I know this would never pass legal muster, but let's call it a thought experiment: just as some countries mandate military service for their youth, why not mandate one year working at a minimum wage job for all American citizens? Give them a range within which to perform the work - say, anywhere between the ages of 22 and 30 - in order to give them flexibility to meet the job market demands. Minimum wage jobs like farming and fast food always need doing, and the experience of actually living on a minimum wage budget and in the fast paced, overworked minimum wage lifestyle would give people a needed dose of financial literacy - and economic empathy.

  • Report this Comment On October 12, 2011, at 5:35 PM, DJDynamicNC wrote:

    Cato - read Morgan's article on the front page of this site for information on how those who work hard and do what they are supposed to, but enter the market during a recession, are punished for life.

    Do you really believe that the United States of America can't do better than that?

  • Report this Comment On October 12, 2011, at 5:37 PM, DJDynamicNC wrote:

    @Tingall - could not agree more.

  • Report this Comment On October 13, 2011, at 3:45 AM, interdependent wrote:

    Thank you to everyone who wrote in support of the simple idea that we really are all interdependent.

    When I make a mistake financially I am responsible for losing money. I know life is unfair. I know I can invest and lose. But when someone I pay to hold my money in a safe (with a sign that says FDIC insured on the window) wrecks my retirement and my investments and my company and I lose my job and my house because they made shady deals that even they don't fully understand, well I think that's a criminal problem, don't you?

    Now if they did that to a billion other people, I'd say we've all got a problem, a systemic problem in our financial markets. And if the government didn't do anything to stop it from happening again, because our elected officials are accepting donations from the bankers who wrecked the world economy, I'd say we have a failure of democracy.

    That's why there's an Occupy Wall Street.

    Because the wealthy hold so much power over our democracy that our elected government cannot regulate them effectively. 'Effectively' meaning only well enough to keep them from destroying completely the very economy and institutions that are making them wealthier than they could imagine.

    The bankers and Wall Street siphon off wealth every time they touch it. They move it around and take a piece. Our financial sector is a growing part of our GDP, even though Bankers don't actually "make" anything, but they take plenty.

    I'm all for bankers getting paid well for providing a service. But it's clear that they "drove the world economy into a ditch" placing bets and stealing from investors and each other. That they buy protection in Washington DC is no surprise, but it means that we have to take to the streets to reform our financial system. Our elected representatives can't do this for us, or they won't get re-elected.

    TO all the Fools who advocate that the protesters 'should quit whining, get a job, life is unfair and your destiny is what you make it', I say to you:

    Get out in the streets! They are not suffering police arrest and harassment because they are lazy. They are rewriting their destiny and ours! And if they succeed, if reform of any kind results in making our economy and markets more stable, you will be the real beneficiary.

    So stop complaining and join the occupation. It could be the best thing you ever do for your money.

  • Report this Comment On October 13, 2011, at 2:02 PM, Robt92122 wrote:

    We need the Volker Rule NOW to keep the banks from stealing from their customers through proprietary trading.

  • Report this Comment On October 13, 2011, at 3:27 PM, Bobvivant wrote:

    The fact that the first thing they have agreed upon is to get their student loans waived, right there they have shown themselves to be nothign more than freeloaders.

    While I agree the tax structure is in favor of the top 1% and whatever else money can buy, like influence, lobbyists, a party (TEA) these 99% are nothing but common thieves. No one told them to find expensive schools or live in swank dorms or have parties every weekend, and they want to cut off the hands of those that lent them the $ to do so.

    At the very least they should be protesting the schools that charged exorbitant fees or dorm rents or maybe even schools that taught useless courses of study to far too many people. These are not the 99%, they are 100% of the world which wants something for free. I guess they are a small % that will protest to get it. Good concept but sadly it has now lost all credibility. They're just people who want stuff free. Oh, me too, sign me up.

    -Bobvivant.

  • Report this Comment On October 13, 2011, at 6:02 PM, DJDynamicNC wrote:

    Bobvivant: "No one told them to find expensive schools or live in swank dorms or have parties every weekend, and they want to cut off the hands of those that lent them the $ to do so."

    I'm interested in the statistics you used to derive this information. Which schools did these protestors attend? What wast he tuition? Precisely how swank were the dorms, in terms of annual living expenses?

    Unless, of course - and I hesitate to make an unsubstantiated claim here, but it seems to be going around - you are simply projecting your prejudices onto the OWS crowd and posting ad hominem attacks on their character backed by unsubstantiated assertions about their lifestyle.

    Since there's no way that could be the case, I look forward to your source on tuition rates and alma maters among OWS protestors.

  • Report this Comment On October 14, 2011, at 9:55 AM, Bobvivant wrote:

    DJDynamicNC - sorry I dont need to provide any statistics. They borrowed $ to attend school. Expensive or otherwise, parties or swank dorms or otherwise.

    They now want that waived.

    Seriously that really sounds like the Housing bubble repeat, like the guy who bought 20 houses and defaulted on it all. Atleast those houses went to the bank be it for a fraction of the cost. A degree cannot even be repoed.

    "Wannabe Freeloaders" is the current slang term I believe fits. But if you have a better term, then let me know.

    -Bobvivant

  • Report this Comment On October 14, 2011, at 11:33 AM, XMFSinchiruna wrote:

    Terrific article, Brian! I have a background in Anthropology, and appreciate the way you wove cultural factors into the nature of our predicament. Bravo!

  • Report this Comment On October 14, 2011, at 12:32 PM, tomgnh wrote:

    To summarize-

    1. People don't like seeing others get fabulously wealthy regardless of how.

    2. What's done is done, and it can't be undone.

    3. Suck it up- it's your fault for voting stupid and getting fooled.

    Did I miss anything important?

  • Report this Comment On October 14, 2011, at 2:25 PM, PeteysTired wrote:

    "When a bank doesn't even ask to see payroll statements or tax returns, you can NOT say the banker is blameless. I place about 70% blame on the banks and 30% upon the borrowers."

    I hope people realize that Fannie Mae was responsibel for No Income No Asset loans. As long as Fannie said approved that loan could be sold to whomever.. Fannie Mae was a good idea that could not ever work. It was not their money.

  • Report this Comment On October 14, 2011, at 2:41 PM, ClockworkLynx wrote:

    I really don't see why people who want college loans waived are being held up as representative of Occupy Wall Street. People are singling out the fraction they can mock most easily so they can dismiss the concerns of the rest-- and that's doing them a grave disservice.

    As investors, we should be looking at the whole picture, not making our decisions on anecdotes.

  • Report this Comment On October 14, 2011, at 2:54 PM, Bobvivant wrote:

    I am only calling that 1 demand - the student loan forgiveness aspect as freeloading. The rest of their points are not un justified at all.

    -BobVivant.

  • Report this Comment On October 14, 2011, at 8:38 PM, TimothyVR wrote:

    This is the only article I have read here that is not a puff-piece telling us how wonderful the protesters are and praising them in romantic and idealistic terms.

    I certainly agree with personal responsibility and our own role in holding corporate governance accountable.

    Nevertheless - the Motley Fool has made a mistake in politicizing the site. The vast majority here are strongly - indeed, dogmatically - in favor of the protesters, even though the protesters themselves don't know who or what they are opposed to and their 'demands' are a grab-bag of dreams and wishes.

    As for 99% - I don't appreciate ANYONE speaking for me.

    When the Obama re-election campaign gets going (any day now) I'm sure the Fool writers will be falling over each other telling us is how wonderful he is.

    That is the problem with politicizing a site that should try to remain apolitical

  • Report this Comment On October 15, 2011, at 11:46 AM, runner49 wrote:

    Wonder what percentage of the 1% got "fabulously wealthy" the old fashioned way, by inheritence. This is part of what make the current tax system inherently unfair. Tax breaks for passive investment income (dividends), highest rates on earned income. Seems that should be reversed, as it was through most of our tax system's history. Anyone recall the maximum tax on earned income? It was there when I started practice in that field (CPA since 1981.).

    Most of the protestors could care less that some of those 1 percenters feel a need for several homes, boats, million dollar weddings and other social gatherings. It is when it comes at the expense of the basic necessities for so much of the lower and middle classes that anger and protest ensues.

  • Report this Comment On October 15, 2011, at 4:24 PM, nick1200 wrote:

    Thank you Motley fool for bringing us current and relevant issues like the Occupy protests.

    As a fellow investor I fully support the Occupy Wall Street movement.

    It's very clear what they want:

    www.occupytogether.org

  • Report this Comment On October 16, 2011, at 7:50 PM, janequick wrote:

    As the other 99% or even the 1% why do we accept policies in the financial system that make it ok for banks to foreclose and remove people from their homes and then auction them off at a much lower price instead of working out an arrangement with the original homeowner. This "punishment" mentality then lowers the value of homes throughout the neighborhood and starts a downward spiral that none of us are immune from.

  • Report this Comment On October 16, 2011, at 10:41 PM, skypilot2005 wrote:

    +rec

  • Report this Comment On October 17, 2011, at 7:42 AM, FUSION10 wrote:

    It's like always, first all the rules are changed at the top(Reagan),

    -then the masses are tranquilized so they forget what really happened to them 99%,

    -then the top 1% want to cash in

    -then the 99% find out that they let it happen, that they got smartened out once again and now they do not how to explain it to their children, that they have to bleed all their life long

    -that their parents were naive and got bribed for a few dollars.

    WHO IS TO BLAME ????

    Thinking that after the banks couldn't deliver, the State needs new milking cows - WHO WILL IT BE???

    For sure is - big money and politics are equal incapable to solve the problem in a good way.

    SO ITS BACK TO THE ROOTS, big business doesn't need us small 99ners.

  • Report this Comment On October 17, 2011, at 3:38 PM, Darwood11 wrote:

    What's it really all about?

    Today, I got an email from MoveOn.org, in which they stated a new initiative. A petition is being circulated "calling for forgiveness of student loan debt—a step that's sure to do more to stimulate the economy than giving more tax cuts to billionaires and big corporations!"

    According to the MoveOn.org "The petition has over 450,000 signatures so far, making it one of the fastest-growing petitions we've seen in years."

    I replied and suggested that they also begin a petition to forgive all mortgage debt; let the government "buy" each and every home mortgage out there. Why not? Might as well increase the public debt by a few $trillion more!

  • Report this Comment On October 17, 2011, at 7:22 PM, hbofbyu wrote:

    The congress is entirely to blame when you get right down to it. They are self-dealers who appeal to emotion rather than facts, easily bought by lobbyists, ignorant of history. They are interested in getting themselves in the paper or on the news, so they accommodate you by making some grandiose statement that is devoid of facts and is a lot of opinion.

    We are well to the point of having a monopoly of big government, big business and big labor calling all the shots. And they are all in cahoots. They are passing laws that favor themselves. They are able to bribe Congress into doing whatever they need.

    You cannot blame this on President Bush or Obama or Clinton. Congress passes laws. The House of Representatives is responsible for spending legislation.

    In 1988 congress was having hearings about the Glass-Steagall Act, a Depression-era law that separated investment and commercial banking activities. A decade before the financial crisis hit (1999) when congress repealed the GSA, many in academia asserted to the panel that the nation’s big banks were threatening the soundness of the banking system by pushing legislation that would allow them to get back into the securities business. Congress ignored the warnings because they are either ignorant of history or acting in their own self interest. Either way they are not worthy of election. Investment Banking and Community Banking need to be separated. Period.

    Blaming Wall Street is pointless. Businesses, corporations, banks never act out of virtue. It is all self interest (if you see a dollar on the sidewalk you WILL pick it up).

    The 99% need to get off their butts, get out of the park, off of Wall Street, and go to Washington where the heart of the matter lies. If they disappear when the weather gets cold I will have lost my faith in the younger generation.

  • Report this Comment On October 17, 2011, at 8:44 PM, theHedgehog wrote:

    From the article: "In case you’re wondering, if your household takes in less than $1.5 million per year, you, too, are in the bottom 99% of income earners"

    How can anyone say BOTTOM 99% with a straight face? I'm in the 10%, how about you?

  • Report this Comment On October 18, 2011, at 1:44 PM, Bobvivant wrote:

    The midterm elections in 2010 where the voter turnouts are in the low 40% or even lower are critical. That was what lead to a TEA party backed republican resurgence.

    I only say that because occupy seems to have an - AnTEA party stance from some T-shirts I have seen.

    Forgiving student or other debt is the dumbest idea I have ever heard and inherently also the unfairest as well as the one with the most moral hazard. The only way I would deal with it is first enforece all teh laws in existence @ the time the loans were taken, all of them wihtout any variance.

    Then after complete repayment, have a reward for the ones that did get that far. Sticks and carrots. These 2 should be properly defined and used. That is what the laws are there for.

    Forgiving debt is simply going to replace the current Occupy group with a group that will say if I had free education as an option I'd have gone to harvard. Moral Hazard people, moral hazard.

    -BobVivant

  • Report this Comment On October 18, 2011, at 1:55 PM, equanimity3000 wrote:

    Good column... I have been collecting fair bit of stats and charts on inequality, but your Figure 1 is something that I had not seen before. It is telling - we are careening toward the pre-Depression level of inequality.

    This chart also provides what the demand of OWS should be: Change policies so that the 1960s "income capture" ratios are reestablished. Keep in mind that EVEN in those seemingly egalitarian 1960s, the chart shows that the top 10% captured considerably more than 10% of income gains...!!

  • Report this Comment On October 18, 2011, at 2:10 PM, equanimity3000 wrote:

    @TimothyVR

    There is a difference between partisan and political. Sure, this column is political, but I did not see in the column any Bush-bashing or Obama-celebrating.

    If you ask me, Clinton-Bush-Obama are all creatures of Finanzkapital, controlled from Wall Street and London's Threadneedle Street (visibly), and from Frankfurt and Munich less visibly (do your research on Allianz, the silent behemoth).

    The OWS people would be politically naive if they think Obama would enact policies they are agitating for.. Obama might, but only if there is intense movement pressure.

  • Report this Comment On October 18, 2011, at 2:56 PM, grusilag wrote:

    There are many things wrong with this article or what it implies. I try to address a few of these points below:

    1) "Here's my theory: I believe the problem is that we detest large disparities (of any kind) within groups. And there's no reason not to feel this way: We're hard-wired for it."

    The issue isn't that we're hard-wired to detest large disparities. The issue is we're hard-wired to detest unjust disparities. Some members of the top 1% have accumulated wealth that is orders of magnitude larger than some folks in the bottom 99%. There is NO rational way to explain this disparity other than to realize that there is a net flow of value from those engaged in value creating labor to those who do not engage in value creating labor. Put it simply - there is no way to to be 1000 or even 100 times richer than someone based simply on a difference in productivity between two individuals. No human is 1000 times smarter than any other human, no human is a 1000 times stronger, or 1000 more entrepreneurial. The only way for someone then, to be 1000 times richer is to extract wealth and value from others who create it. How this is done in our monetary system is a long discussion but that is the point.

    2) "We know all too well what happens when communism is given a try, Americans are tepid at best when it comes to socialism, and we've enjoyed far too many fruits of capitalism's efficiencies to throw it out the window."

    True capitalism leads to LESS disparity in wealth. In capitalism, the individual owns his or her own capital and makes efficient decisions about it. This leads to an even playing field where disparities in wealth are ostensibly determined by merit, hardwork etc. As I've expalined above, in such a world it is impossible for any individual to be 1000 times richer than any other individual, no matter how "lazy" or "stupid" that poorer individual is. We don't have capitalism. In our system OTHERs own our capital. We don't have true capitalism, we have crony capitalism or socialism for the rich. This was easily shown by the bank bailouts. Lets be clear - without the bailouts, not only would AIG, Freddie, Citibank etc be out of business today, so would nearly the entire financial industry since they all depend on each other. Wealth was extracted from the poor and given to the rich (that's how people become rich in the first place - see a recurring theme?) That's what people are angry about.

    3) "Too many times, I've seen signs and heard interviews with protesters clamoring over the loss of their houses. . . no one held a gun to anyone's head and forced them to make purchases they shouldn't have been making in the first place."

    Here you are implying that home owners lose their homes because they foolishly borrowed money that they should have know they couldn't repay. But lets imagine a world where all such individuals were smart enough to avoid taking on such loans. Would we then have a foreclosure free world? No. As the system is set up, no matter how few people take loans out (for their homes, education, cars.. whatever) some will ALWAYS default. Its built into the system. Please look up the "debt-virus" problem. To put it simply, when a loan is given for $10 but the amount owed back is $11 (due to interest) there is no way to ever repay the loan in a debt based monetary system such as ours. Its simple math - $10 can never equal $11. In other words there is a net deficit roughly equal to the outstanding interest owed on all debts in our system. Put another way: there is more debt than there is money in existence to repay it.

  • Report this Comment On October 18, 2011, at 3:13 PM, equanimity3000 wrote:

    @grusilag

    Agree with most of what you say except your view of "true capitalism"...

    Since 1900, true capitalism has consisted of money being made from money (capital begetting more capital).

    Post-1900 capitalism is no longer about the fruits (profits) of industrial activity being split (justly or unjustly) between owners and workers.

    Contemporary capitalism is Global Financial Capitalism.

    To think otherwise is sheer romanticism.

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