Are Americans Horribly Misinformed on Who Has Money?

I have seen several Tweets today promoting this upcoming article:

http://www.filesanywhere.com/fs/v.aspx?v=8a6966875c5e70af6f9a

There are so many problems with this research and with its interpretation that I am compelled to blog.

Be sure to read the article itself, not just the summaries / commentaries about the article. Go read it now. Before you read my comments.

If you read the article, ask yourself whether the polled audience is really likely to be able to provide an informed set of answers to the questions asked. By this I mean:
a. Are they likely to understand the terminology enough to speak to the questions?
b. Are they likely to be able to do the necessary math and statistics?

For example, the study is an investigation of the distribution of WEALTH. I.e., NET WORTH. The authors are careful to cite this, but the commentary I have seen on the article (and I suspect many of the survey participants) make the common mistake of confusing WEALTH with INCOME. It doesn't surprise me one bit that the vast majority of our society has a very low net worth. There are quite a few HIGH INCOME people in that group who for a variety of reasons (primarily EXCESSIVE DEBT) have a very low (or negative) NET WORTH.

The study seems to ASSUME that the existence of an "ideal distribution" of wealth. And it assumes that the random citizen on the street should have a valuable opinion on what that ought to be and how we ought to move toward it. I personally don't believe that there is an "ideal" answer. What I DO believe is that people should live within their means as much as possible. Americans, in general, believe they are entitled to a certain standard of living and are far too eager to take on massive debt to support their large houses, high-end vehicles, and consumer goods.

The authors also seem to have biased their results by providing 3 "sample" distributions of wealth. The first is an "equal" distribution of 20% of the wealth in each quintile (why are quintiles magic? why not divide equally into thirds? fourths? fifteenths? -- these are NOT mathematically equal!). The particular way that the authors have chosen to represent the data makes it very difficult to visualize.

There is much more that could be said here. But I hope you get the basic idea....