How Much Control Do You Have Over Your Income?

(These are just thoughts that roll through my head while I’m performing mundane tasks like folding laundry. I don’t think there’s really a point.)

Like many youngsters in the U.S., the idea of The American Dream was simply instilled in me, the idea that anyone — if he/she works hard enough and fearlessly seizes opportunities — can achieve just about anything. Growing up, we’re regularly bombarded with examples of both real-life and fictional figures who started with next to nothing and achieved “greatness” or wealth; this was supposed to be inspiration that would prevent obstacles from cowing us, motivation to continue striving for greener pastures.

There are popular movies like Rocky (1976) and Slumdog Millionaire (2008). While almost none of us are poor boxers in Philadelphia or teens in the Mumbai slums, we see something in ourselves in those movies.

There are real-life examples from reality television heroes like Carry Underwood to political powerhouses such as Bill Clinton — not to mention the classic example of Abraham Lincoln.

It wasn’t until I was older and experienced difficulties of my own that I learned many social reformers (and even statisticians) criticize the propagation of rags to riches stories, arguing “that only a handful of exceptionally capable and/or mainly lucky persons are actually able to travel the ‘rags to riches’ road”. In other words, those are the exceptions rather than the rule. It’s disingenuous to tell every child that if they’re good, they can one day sit at the top of the heap.

More recently, I became aware of new studies (like this one) that show more Americans (41%) believe the “American dream” isn’t possible for most people any longer than those (38%) who believe it’s still possible.

All of these tumbling thoughts led me to the question: How much control does anyone really have over his or her own income?

Without question, most people have some control over their income, especially in the U.S. You could quit your job, for example, taking your income from current level to $0 in a heartbeat. (Not very practical, but it IS control.) Anyone who owns property — a house, any amount of land, a vehicle, or a gun — can sell said property to increase income. (You can’t force anyone to buy it, but with the right price you can probably find a buyer.)

Those are obviously temporary methods and could result in fiscal disaster for your household if not done carefully or at the right time.

But how much truth is there to the “anyone can make it big” theory? First, note that “anyone” isn’t the same word as “everyone”. Much like the Army needs only a handful of generals but many thousands of privates and corporals, the business world can’t be filled with CEOs and the capitol can’t be filled with Presidents. The only way the world works is for some to be under and others to be over.

In other words, someone has to be the janitor, the receptionist, the programmer, the repairman, the plumber, the engineer, and so on. In any company, there are only so many spots for middle manager, and fewer spots for vice presidents, board members, or Top Dog. So, even assuming it’s possible that any member of the bottom rung can jump to the next level, it’s clearly not possible for everyone to make that leap. (How well would your local grocery store operate if everyone was Store Manager, and no one was Stocker, Bagger, or Checker?)

My initial hypothesis is that almost no one has very much control over his or her income.

It’s tempting to think rich people have more control over their income than middle class or poor people, but I’m not convinced of that either. Sure, the wealthy can sell property or stock, but that has the same result as it would for you or me, just on a larger scale. Huge companies can gamble on massive advertising blitzes, but there’s no guarantee it’ll work — and those sometimes backfire or just fall flat. (And there is such a thing as bad publicity.)

But the average person (and certainly my average reader) is neither a rich person nor a big corporation, nor someone ready to quit his job or sell all her property.

The fact is, most people I know have little-to-no ability to increase their income, especially without taking big risks like investing in the stock market (and even then, you only have control of what you buy and sell, but no control over how much money is made). Even switching jobs can be a gamble that might not pay off. Asking for a raise is sometimes recommended, but (in my experience) rarely pays off. Bucking for a promotion is one way, although — as I mentioned above — there are only so many spots above you, and you may not actually want any of those spots. You might leave a niche that you enjoy for a stress-filled rat race that takes up much more time and effort with only minimal extra compensation.

If you’re young and haven’t yet entered the workforce, perhaps the biggest thing you can do to control your income is get a bachelor’s degree. College graduates earn significantly more than those without degrees — though be prepared to listen to a bunch of anecdotal evidence to the contrary (“My cousin didn’t even graduate high school and he earns six figures!”)

(And if you find a way to magically change your gender or ethnicity, that might help too: “To earn as much as their male colleagues, women tend to need much higher degrees, even while working the same hours. Black and Latino master’s degree-holders don’t out-earn white college graduates. But Asians with graduate degrees out-earn all other races and ethnicities at the same educational level”, according to the L.A. Times.)

You can’t force your boss to give you a raise or promotion (and if you ask too often you become an irritant). You can put things up for sale, but can’t force anyone to buy them (especially if your prices are rigid). You can circulate your resume hoping for a better job, but can’t force any company to hire you.

If you’re drawing Social Security retirement, or retirement funds from your old job, it’s commonly referred to as “fixed” income, because you can’t change the amount. If you’re receiving unemployment benefits, welfare, food assistance, and so on — the story is the same.

All of this is more true when the economy is stagnant or receding, while the average person has a little more control when the economy is booming — more companies expanding and therefore hiring, more stocks on the rise, though I still contend that the average person has very little control.

Remember those “get rich quick” commercials? I haven’t seen any since the 2007/8 recession, but I remember them. Most of them had something to do with real estate. Buy foreclosed properties, fix them up for rent or sale at a higher price. Even then, you’re at the mercy of the market’s needs — whether people are ready to buy/rent at that time, at the price you set.

Criminals? Even a big-time drug dealer depends on the suppliers and customers — at the mercy of the market. A burglar has to be able to sell what he steals.

I’m sure I missed some facets of this thought exercise — it took place over several days, broken often by the cries of a baby, questions from a toddler, phone calls, and other requirements of day-to-day life. But I think I spent enough time on it to arrive at a conclusion: the average person has little control over his or her income, despite obvious rags-to-riches examples — most of whom were lucky in addition to being brilliant and hard-working.

  1. Shari says:

    Interesting thoughts.
    On a slightly related topic, I’ve realized lately that (up until recently) when we would want more money, it always came down to looking for a “job”. But when our Mennonite friends want more money, they look for “work.” The distinction may not be obvious, but it’s the difference between going around filling out applications at minimum wage outfits, and going door to door and offering a service. Of course those are simple examples.
    As a child and then a wife of a government-salaried man all my life, the notion of independent contracting is both liberating and frightening.

    • Wil C. Fry says:

      Just don’t go door-to-door on my street. ;-)

      (I believe it should be codified into law that unsolicited knocking on my door is trespassing.)


      But yes, “work” is the old model, while “job” and “career” fit more nicely into today’s economy — because most people have regular payments that need to be matched by regular and dependable income.

      For anyone who can live without the monthly “needs” of electricity, city water, phone service, cable/satellite TV, trash pickup service, rent/mortgage, and so on, a regular paycheck isn’t quite as important.

      (I put “needs” in quotes because clearly the human race got along for millennia without any of these.)

      The more rural the household, the more likely you are to not have some of these anyway, and to not need them. As millions of us clump together in cities, some things (like city water and trash pickup for example) become absolute necessities for health reasons, while others are conveniences to distract us from being trapped on our tiny lots. :-)

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