Good To Be Rich, Millionaire Wealth To Double In Next Decade

Millionaires are going to do pretty well in the next decade. According to a report from the Deloitte Center for Financial Services, the total wealth of millionaire households in 25 major economies is likely to grow from $92 trillion in 2011 to $202 trillion in 2020.

The fate of millionaires, of course, is a major concern to all of us, something akin to the latest rehab news from Hollywood. It catches your attention.

The really good news concerns the US. When it comes to millionaires we’re #1.

“In spite of the rapid growth of wealth in the EM (emerging market) economies,” said Deloitte, “U.S. and Europe will remain the global centers of wealth over the next decade, in terms of both the amount of wealth held and the number of millionaire households. Our analysis indicates that aggregate wealth of millionaire households in the U.S. in 2020 will likely reach $87 trillion, from $39 trillion in 2011.”

That means US millionaires will see their wealth more than double during the coming decade.

Wealth In America

And, adds the study, “our forecasts suggest that, in 2020, 43% of the world’s wealth among millionaire households will be in the U.S. Opportunities for growth potentially exist via greater U.S. state penetration. In the U.S., California will likely have the most number of wealthy households, while New Jersey may continue to have the greatest density. The East Coast is likely to see the highest growth rates — New York and Florida together may add 1.5 million new millionaire households by 2020.”

I think this is great stuff. Having lots of millionaires suggests a vibrant economy and widespread opportunity.

Indeed, the report tells us “the U.S. is likely to continue to be home to the largest number of millionaires, potentially rising from 10.5 million households in 2011 to 20.5 million households in 2020. Its nearest competitor may be Japan with an estimated 8.6 million millionaire households in 2020.”

Household Income

What about the rest of country, the non-millionaire households?

According to the Census Bureau, the typical household income was $52,587 in 1999. By 2008, that figure dropped to $50,303.

In other words, household income is falling and the average figures are actually high for many families. The median income for Black households in 2008 was just $34,218 while Hispanic households took in $37,913.

The household income figures tell us that not everyone is getting in on the good times. And looking toward the future, it’s apparent that a lot of average folk won’t do as well as our financially-advantaged citizens.

Down To Earth

Consider the NASA space shuttle. By any standard it’s a huge success; a triumph of science, technology and personal bravery plus a great symbol for the US — but the program will end this year and when it does 8,600 jobs will be lost.

The people screaming about the need for less government should be thrilled. Principle and absolutism win. We’re sure going to spend less.

The space shuttle program is a good example of government spending that generated enormous benefits.

What benefits?

When the space race began in the 1950s and 1960s the Russians had a tremendous advantage in rocket power. They could lift heavier loads into orbit.

But, clever folks that we are, we turned a liability into a plus. Since US rockets could not compete in lifting power we had to miniaturize the things we sent into space. That helped develop more efficient transistors, which lead to smaller and smaller electronics, which brought us to cheaper and more powerful computer chips, and that lead to the first personal computers.

I’m glad things are going well for the upper crust. I’d also be happy if things went well for the lower- and middle-class and toward that end the constant pressure to shrink the federal government makes no sense. Just ask any mortgage-paying shuttle worker facing layoffs; or the neighbors who will see home values go down as foreclosures increase as a result of the NASA job losses in Texas and Florida; or the local governments who will now be faced with both reduced property and income tax collections as well as higher costs for unemployment and welfare.

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