The real problem with that statement is that it misrepresents the problem.
The fact that our poor live as well as middle class (or even upper class) in developing countries does not mean anything, because our poor do not compete for the same resources and opportunities as those people. Our poor compete with our rich, and the wider that gap, the worse the situation.
In other words, what really matters is the standard of living of our poor relative to that of our rich.
The problem of wealth disparity in the US is exclusively one of burden sharing: disparity is a problem when those of lesser means are required to make actual sacrifices, like risking bankruptcy for an appendectomy, or sending their kids to classrooms with a 45-1 student/teacher ratio. It's a problem implicating disparity because the Bugatti drivers could, it's often asserted, pick up a greater share of the burden while feeling less of the impact, because the marginal utility of their dollars is less than those of a poor person.
But the problem is not simply that there are rich people, or that they have things you & I don't have. Many of the things rich people have are stupid. But even when they're not, they almost never cost you anything; in fact, because the rich choose to soak themselves with Veblen goods, their extravagant purchases actually help you by driving the economy.
So yes, living among people who make much more than you obviously depresses your standard of living / cost of living.
Measures of "happiness" and "contentedness" are tightly bound to our environment. Being at the respective top or bottom of a given social order has a meaningful impact on quality of life perceptions. Obviously, some Maslow'esque hierarchy of needs applies here, and no-one in the world is happily starving.
> But even when they're not, they almost never cost you anything; in fact, because the rich choose to soak themselves with Veblen goods, their extravagant purchases actually help you by driving the economy.
That seems to make the implicit assumption that conspicuous consumption is the most effective means of investment for those assets. It may well be the case, but I've never seen it suitably demonstrated.
I'm not saying that buying a Bugatti is a social good; it clearly isn't. I'm just saying that those purchases aren't a drag on the middle class, except to the extent that they represent a missed opportunity for a more-just burden sharing to offset a needless sacrifice by the working class that could realistically be addressed by the rich.
Again the point is: simply sitting around being rich isn't intrinsically harmful to the lower and middle classes.
Obviously this doesn't apply to an iphone, a private jet, or a Bugatti Veyron.
But if you want a haircut or groceries, it applies. Likewise to a host of other goods and services that the poor spend money on.
Give me bottom 10% in America ($10,500) and I'm very, very poor.
There are countries where you can live like a king on that same amount of money.
(It depends how much you value personal services such as maids, cooks, etc. which tend to be most affected by this phenomenon)
Sort of stupid. It actually costs money to eat healthy, which many people can't afford in the states (fresh fruits and vegetables, grocery store far away, no car, just by crap at the convenience store then).
The US doesn't compare well to Europe on quality of life for those not in the middle class. Ya, they can afford some crap, but not what they really need to improve their lot (decent food, decent education, healthcare...). The libertarians don't really get that, and think everything is peachy perfect in the states (except for too much socialism).
http://npc.umich.edu/publications/policy_briefs/brief28/poli...
This reminds me of Medicaid in the US. Something like 20% of the uninsured in America are actually qualified for free healthcare, but don't enroll.
