What if We are the 1%

By Elena Torres-Pepito

Where do you think you fall in the global income distribution? Are you wealthy? In the middle? Impoverished? When Gautam Nair, a Political Science Ph.D. student at Yale University, asked this question to 1,500 Americans, he found that on average they estimated their income to be in the 60th percentile globally. However, this estimation is completely inaccurate. With the average American household income sitting at $63,000 a year, the average global income would need to be around $20,000 for the estimation to be accurate. But it’s not. It’s $2,100. 

In fact, the vast majority of Americans are comfortably in the top decile when it comes to income across the globe. Strikingly, if one person brings in the average household income in the United States, they themselves are part of the “1%”; that line is drawn at $50,000 a year. As we can see, there’s an interesting instance of ignorance in the United States where we don’t seem to realize how rich we really are. 

This may seem a strange claim to make in a country where reports of increasing homelessness and stagnating wages populate our news feeds. After all, 13% of Americans live in poverty and 11% experience food insecurity–these hardly seem like hallmarks of an exorbitantly wealthy country. Except that the United States sets the poverty line at $11,770 a year for an individual as opposed to the much lower average global income. Of course, some of this difference is accounted for by the fact that countries have different costs of living. The United States is an expensive place to live, and when you live in a country full of rich people, it can be particularly harmful to be poor since you experience social stigmatization and isolation in addition to the typical hardships of poverty. Poverty in the United States is by no means easy, but it’s also nothing like the absolute poverty that over 700 million people experience every day.

Absolute poverty means living on less than $1.90 a day adjusted by purchasing power parity. In these conditions, a person cannot afford basic necessities of life like electricity, plumbing, clean water, or adequate food. Absolute poverty leads to child labor and life expectancies decades lower than those in industrialized nations. Fortunately, absolute poverty has been steadily decreasing for decades. However, it still affects 10% of the people on the planet, and that decline is likely to reverse amidst the expected recession and economic disruption brought on by the COVID-19 pandemic. 

With this in mind, it’s fair to wonder why Americans are so lacking in a global perspective. Ignorance affects public opinion on national policy: when people are told their relative wealth, they are twice as likely to support increasing foreign aid. If we are better informed about the world, then our demands of our politicians, and in turn what actually gets done, might change. Even so, it can be hard to gain this perspective when the discourse we are surrounded with on a daily basis and what we observe in our lives, perhaps understandably, warps our perception of the world.

What we see every day is what we come to expect and what we use to draw our conclusions. The richer a person is, the higher they estimate the average global income. Living in a first-world country means that we are surrounded by wealth and are rarely reminded of the existence of abject poverty elsewhere. The media we consume focuses on local happenings, on domestic poverty and fights over the minimum wage and rising housing prices. To capture an audience, news outlets report on sensational events instead of prolonged tragic states of being. Even when we turn to fictional entertainment, the vision presented is defined by people who themselves tend to be comfortable and educated, unlike many who are in absolute poverty. People in absolute poverty are unlikely to become reporters, writers, or producers, as that takes power, wealth, and education. That’s difficult to attain when survival comes on a daily basis. 

In our political discourse, we talk about economic inequality, but it’s confined to inequality within our country. On a certain level, this makes sense. Of course politicians and activists focus on what they have the most control over. However, eventually, it does seem like a conspicuous omission to define the boundaries of inequality in a narrow enough sense so that average Americans never have to contend with their own relative wealth on a global level. 

A nation so blind to its own wealth cannot function knowledgeably in global governance. However, this ignorance is a symptom of a wider issue. It’s rooted in ethnocentrism that keeps us from focusing on the lives of those beyond our borders, especially when they are people of color. It’s caused by media that is similarly myopic and neglects the stories of the vast majority of people on the planet. And all of this results from a population that doesn’t demand a global perspective, which is understandable: why take on the guilt and responsibility if it can be avoided? Except without acknowledging this and facing it, we’ll never be able to fix it. 50% of Americans support decreasing foreign aid. Only 14% want to increase it. We also think the average global income is ten times its actual amount. We’re living in a bubble, and though it might be comfortable, this complacency keeps us from acting on humanitarian efforts and taking part in uplifting all people out of absolute poverty.

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