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The world on a billionaire’s budget
Who needs student loans, health care and mortgages?
A billionaire's spending power is difficult to grasp, both because most people do not correctly intuit large numbers, and because a billion dollars far outstrips most people's experience.
What does a household budget look like to a billionaire? To find out, let's scale down a billionaire's income to $50,000, the median American income, adjusting budget items proportionally.
A year in the life of Joe Billionaire
To start, we need to estimate a billionaire's annual income.
In the 30 years from 1987 to 2016, Bill and Melinda Gates amassed about $120 billion. This figure represents $80 billion in net worth and $40 billion controlled by their charitable foundation. The Gates' average annual income for these years is $120 billion divided by 30, or $4 billion. (The Bill and Melinda Gates Foundation is a strategic partner of The Conversation US and provides funding for The Conversation internationally.)
According to Forbes, the wealth of Amazon CEO Jeff Bezos increased last year from $72.8 billion to $108.7 billion. Despite billion-dollar hiccups caused by daily stock price fluctuations, Bezos' 2017 wealth increase was at least $32 billion, over $1,000 per second around the clock.
One cube represents the median U.S. worker's income. (Andrew D. Hwang, CC BY-SA)
The Gates and Bezos are extremes. But what about a more typical billionaire's income?
Let's assume a new fortune has been acquired over about one decade. Since the median worth on Forbes' list is about $2 billion, a ballpark estimate of annual income is one-tenth of this, or $200 million.
In absolute terms, $200 million per year is over $6 per second around the clock, equal to the global median annual income every eight minutes. Each year, Joe Billionaire amasses 4,000 median American incomes.
In 2017, Jeff Bezos raked in 150 times more than Joe Billionaire – the equivalent of 600,000 median incomes.
A billionaire's household budget
Because Joe Billionaire accumulates 4,000 median American incomes, a $4,000 expenditure for Joe Billionaire is the same fraction of income as $1 for a median American earner.
Let's call $4,000 one "Joe buck," or J$1. Joe Billionaire's annual income is J$50,000. Thus, a $2,000-vacation package costs J$0.50, proportional to a half-dollar from a middle-class income.
At this scale, a generous annual food budget comes to J$3. One year's tuition at a prestigious university costs J$15. An extended stay in a top-quality hospital might run J$50. For J$150, Joe Billionaire can pick up a large middle-class home in most parts of the United States. If that's too modest, a week's income buys a mansion in Rancho Palos Verdes, California. Who needs student loans, health care and mortgages?
Unlike a tithing purchase for you or me, a one-time J$5,000 donation for Joe Billionaire has no effect on spending power. We're speaking of a scale where lavish living costs a few hundred Joe bucks. Next year will bring another J$50,000.
Matters of perspective
Ronald Reagan fomented outrage at one welfare recipient cheating the government of $8,000, or J$2. Unfortunately, we are not proportionally outraged by theft and losses dwarfing the human scale.
By comparison, the Reagan-era savings and loan scandal, the Enron scandal, the mortgage-backed securities crisis and the annual losses to offshore tax havens cost ordinary taxpayers hundreds of billions of dollars, tens of millions of times more than one welfare cheat. That's enough to drain or break even Jeff Bezos' bank.
Public services are inexpensive by comparison. The 2017 budget for the National Institutes of Health was about $33 billion; for the National Science Foundation, $7.5 billion; for the National Endowment for the Arts, $150 million. The 2017 Boston city budget was just under $3 billion, including about $1 billion for public schools, $200 million for pensions and $78 million for the Public Health Commission.
We live in a world where two dozen of the wealthiest individuals could collectively fund health and science research for the United States, where any of the thousand billionaires could individually fund the NEA with no practical impact to their purchasing power. Participatory government may remain, but only the ultra-wealthy need apply.
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The team caught a glimpse of a process that takes 18,000,000,000,000,000,000,000 years.
- In Italy, a team of scientists is using a highly sophisticated detector to hunt for dark matter.
- The team observed an ultra-rare particle interaction that reveals the half-life of a xenon-124 atom to be 18 sextillion years.
- The half-life of a process is how long it takes for half of the radioactive nuclei present in a sample to decay.
A study looks at the ingredients of a good scare.
Catching fear in a bottle<img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yNDYyNzg1Ny9vcmlnaW4uanBnIiwiZXhwaXJlc19hdCI6MTYyOTQwMTcyMn0.WtpJ1E_dhK2o09fBpKARynj4_p5NXeklgsXsbd7xr9w/img.jpg?width=980" id="8ff51" class="rm-shortcode" data-rm-shortcode-id="f10dd9188b173f4a36e85e9325507c6b" data-rm-shortcode-name="rebelmouse-image" />
Credit: Photo Boards/Unsplash<p>Previous studies have tracked physiological signs of fear arousal, but none have established a one-to-one correlation between that arousal and specific, actual fear events.</p><p>Andersen says that much of the research has been conducted in lab settings with weak fear stimuli, observing subjects as they experience things like scary videos. Scares in these situations tend to be weak and difficult to measure. Even harder to track in these situations is the link between enjoyment and fear. </p>
Eyes everywhere<iframe src="https://player.vimeo.com/video/109695164" width="100%" height="480" frameborder="0" scrolling="no" class="rm-shortcode" data-rm-shortcode-id="267ba87cfb8591ed5830499574d2272a"></iframe><p>Andersen and his colleagues conducted their experiments at <a href="https://dystopia.dk" target="_blank" rel="noopener noreferrer">Dystopia</a> Haunted House, a commercial attraction in Vejle, Denmark constructed in an old, run-down factory. The Recreational Fear Lab has a long-standing partnership with the spook shack.</p><p>They outfitted 100 volunteers with heart monitors and sent them on their terrifying way through the 50-room horror mansion. The facility incorporates a number of fright mechanisms including frequent jump scares in which a sudden threat takes a visitor by surprise.</p><p>Researchers surreptitiously observed their participants on closed-circuit video as they made their way through the attraction. They tracked each individual's scares, scoring them for intensity according to their visible reactions. After exiting the attraction, individuals self-reported their experiences in the haunted house.</p><p>Combining these self-reports with observer notes and each participant's heart-rate data gave the researchers subjective, behavioral, and physiological insights into the ways in which fear is experienced, and when it's a good thing or not.</p>
A pair of inverted U-shapes<p>In analyzing their data, the researchers saw two separate inverted u-shape curves. One depicted participants' enjoyment based on their self-reports and observed behavior. A similar u-curve was detected in their heart rates showing that just the right amount of heartbeat acceleration is associated with fun, but too much is too much. It's the terror Goldilocks zone.</p><p>Says Andersen, "If people are not very scared, they do not enjoy the attraction as much, and the same happens if they are too scared. Instead, it seems to be the case that a 'just-right' amount of fear is central for maximizing enjoyment."</p><p>The research suggests that being scared is enjoyable when it represents just a quick minor physiological deviation from one's normal state. When it goes on too long, however, or triggers too severe a physiological change, it becomes disturbing. Game over.</p><p>Andersen notes that this is not dissimilar to the factors known to make interpersonal play enjoyable: just the right amount of uncertainty and surprise. These are, maybe not coincidentally, also the ingredients of a successful joke.</p>
A meteorite that smashed into a frozen lake in Michigan may explain the origins of life on Earth, finds study.
- A new paper reveals a meteorite that crashed in Michigan in 2018 contained organic matter.
- The findings support the panspermia theory and could explain the origins of life on Earth.
- The organic compounds on the meteorite were well-preserved.
Meteor streaks through Michigan sky<span style="display:block;position:relative;padding-top:56.25%;" class="rm-shortcode" data-rm-shortcode-id="80b7f30820153b35fc515592d7475f53"><iframe type="lazy-iframe" data-runner-src="https://www.youtube.com/embed/EPu2qnqMYBo?rel=0" width="100%" height="auto" frameborder="0" scrolling="no" style="position:absolute;top:0;left:0;width:100%;height:100%;"></iframe></span>
The meteorite that smashed into Strawberry Lake carried pristine extraterrestrial organic compounds.
Credit: Field Museum