Monday, 16 June 2008

You can check how rich you are

A while ago, a friend sent me a very interesting link, Global Rich List. On this website, you can check how you are ranked in terms of your income in comparison to the other six billion inhabitants of our blue planet. The idea behind this little tool is simple: it is based on the income distribution data from the World Bank Development Research Group (which is an approximate statistical estimate, of course), you just have to select your income currency, enter your annual income amount, and click on the calculation button. If your income is above $47,500 (I would guess it is a starting salary for many college graduates in Canada and the U.S.), you are a proud member of the top 1% group of the world's richest individuals. Who cares if there are other 30-60 million people ahead of you on this list? You are rich, my friend!

Many people are probably whining and complaning every single week that they do not have enough money, that most other people are richer than them, that they can't afford buying many things. After looking at your global income ranking - provided that you live in Canada or in the US, have a university degree and a source of stable income from employment or self-employment - such complaints should cease for good. Living in one of the world's wealthiest countries, you should always be aware that the vast majority of people around the world do not even have basic necessities like clean water, food, and heating - something that most of us in North America and Europe take for granted.

Other side comments: The formula of economic well-being quickly becomes too complicated once you introduce extra variables into the equation. First, even if you make a $100,000 every year yet have over a million dollar debt, your real wealth is probably not that good - the most important thing is not how much you earn, it is how much you spend and save relative to your income. Second, this ranking tool does not take into account how much you have to pay for different consumption items and what portion of your household income you pay in taxes. Third, one should also take into account public sector services and the variety and quality of goods and services that individuals get in different countries.

We pay over 50% of our income in taxes (if you sum up income, payroll, consumption, and property taxes) in Canada, and prices on certain items (like food and housing) in Canada are very high. Yet at the same time we have access to reasonably good healthcare, education, social services, public security, and infrastructure. Overall, we are probably not entirely ripped off by our government, although of course we want certain improvements in the provision of public services and want sound changes in the tax system.

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