Mocking 1-percenters is easy, but the wealth gap is the real problem

The rich are different from you and me – they're more fun to mock.

A doctor-dentist couple we'll call Eric and Ilsa have learned this the hard way. They were featured in the weekend edition of The Globe and Mail's ever-popular Financial Facelift, where they opened their books to the world in exchange for some input from a financial planner. Now, the world can't stop mocking them.

The website Gawker posted a story that revelled in the idea of a couple making $360,000 a year ($450,000 when Ilsa finishes maternity leave and returns to dentistry) and reaching out for help on how to afford a house. A fake Twitter account was set up. At least one news website posted a story about the whole spectacle, and a Toronto radio station asked to interview me about it (I was too busy writing this column).

Funniest headline: "Get out the tiny violin," on the Storify website.

Eric and Ilsa had the misfortune to be wealthy 1-percenters who ran into a flash mob of angry 99-percenters with legitimate grievances about income inequality and fairness. This couple is in an enviable position, with great jobs and a high income. To think of them as having financial problems seems ludicrous.

But at the same time, their victimization is just a little bit too easy. To quickly recap, they bought an expensive lot and want to build an expensive house on it for them, their five kids and a live-in nanny. The problem: Their aspirations exceed their income.

Here's my two cents on what they should do – sell the lot, probably at a profit, and find a nice house that's easily affordable. But that's not the Canadian way in this decade of low interest rates and unrestrained spending.

We all want to take it to the max, and we're not big on living within our means.

Canada's No. 1 problem in personal finance is not a lack of saving, it's spending beyond our means. Eric and Ilsa show us that it's a problem uniting people of all backgrounds. This couple is you and me, only with a higher income.

But people don't see it that way. Online and on social media, they have turned Eric and Ilsa's financial facelift into a trial of the 1 per cent.

All that needling is actually an eruption of resentment about income inequality, an issue that has had more traction in the United States than in Canada so far.

Several years back, the left-leaning Canadian Centre for Policy Alternatives issued a report saying the 1 per cent was a group of 246,000 people with average income of $405,000. Statistics Canada data from the 2011 National Household Survey suggested the 1-per-cent income threshold was $191,000, or almost seven times the median income back then of $29,900.

Coincidentally, the article about Eric and Ilsa had a ranking on the Globeinvestor.com most read list that was a few notches down from an Oxfam report saying the world's wealthiest 1 per cent will soon be richer than the rest of the world combined.

Mark it down – income inequality is a problem with legs. Economic growth isn't going to raise all boats any time soon. Seven years after the global financial crisis, we continue to hear dismal economic news that suggests people fighting to keep what they have and not gain ground. We have a generation of young adults today who seem poised to achieve a lower standard of living than their parents.

Darn right, people are mad about this.

But while being angry with 1-percenters like Eric and Ilsa is understandable, it's also ineffectual. They're not the problem. This couple worked hard in school and graduated into extremely demanding professions that happen to pay well. Good for them.

The real issue is not the wealth of the 1 per cent, but the difficulty the 99 per cent is having in raising its own standard of living. Why are young people having so much trouble landing career-building jobs? Why are pensions disappearing? Why are more companies offering contract work instead of full-time jobs? Why is it so hard for laid off middle-aged workers to find new employment?

If you want to hear more about wealth inequality, make it an issue in the federal election campaign coming later this year. As for Eric and Ilsa, let's dial it down. Mocking them means we're not talking about what really matters.