Poor guy, rich guy

Question: With the rich getting richer in this country, how is the little guy supposed to get ahead?

Answer: Get older and get a job.

No, that isn't a joke or a sarcastic remark. It is the most-obvious and most verified path from poverty to prosperity.

In an excellent editorial appearing in Wednesday's News-Star, columnist Walter Williams takes on the idea that our economy is split between "haves" and "have-nots."

"Talk about the poor getting poorer," Williams writes, "tugs at the heart of decent people and squares nicely with the agenda of big government advocates, but it doesn't square with the facts."

Citing government and private studies, Williams points out that while the statistics tracking numbers of rich and poor remain fairly constant, the people making up those statistics change constantly.

For example, if the number of people living at or below the so-called "poverty level" was 15% in 1980 and 15% in 2000, one might conclude that the same folks have been down and out for 20 years.

Not so.

Most of the folks who made up the 15% in 1980 have (a) gotten older and wiser and (b) gotten better jobs since then. Only one of ten who was poverty level before is still there.

Reading Williams column reminded me that I was one of the "poor" once. The year after I graduated from college, I got an entry level job making about $1,000 a month. I'm pretty sure that qualified me pretty near the "poverty level" at that time.

I know that I'm getting old, because I find myself saying things only old people say, like, "We were poor back then…but we didn't know it."

Thankfully, for me and many other folks, things have gotten a little better than that since then. But doesn't common sense tell you it should work that way?

I am not so much trying to give you an economics lesson as I am trying to give you hope.

Too many people who have the mindset that the deck is stacked against them, that they will never get ahead, that they are economic victims and there is little use in trying. Unfortunately, people with no hope give up.

Don't let that be you. Take hope. Don't give up.

Consider the path of a young person today: assume she enters the workforce earning $20,000 per year. Each year, she achieves a 3% "cost of living" raise and nothing more. By the time she retires, she will earn $63,000 per year. She is neither rich nor poor.

But if she simply cultivated the habit of saving 10% of her income, and was able to earn an average 8% return on her investments, she would reach age 65 with about $750,000. That would put her in the top 1% of all Americans.

Financial success isn't a matter of your background or your beginnings, but of your discipline and diligence.

Are we primarily a nation of haves and have-nots? You might think so if you listen to some folks. But that assumes a set-in-concrete economic class system that isn't borne out by the evidence.

Rather, I'd suggest we are a nation of I- think-I-cans and I-know-I-cant's.

I can't promise you success if you try - but the evidence says that most folks come out fine when they do.

But I can promise that if you don't try, failure is your certain result.

And that's a guarantee.