The United States of America is consider to be one of the most wealthiest countries in the world today, if not, the most wealthiest country in the world. Yet, it has the most uneven distribution of wealth of any country today. As wealthy as the country is it, it can’t even provide/doesn’t truly give the basic needs for its citizens like healthcare, housing and education. For the longest time, there’s been a wide gap between the poor/middle class and the wealthy that’s may consider to be ‘unjustified’ and the gap keeps on growing at a rapid rate. This gap is referred as income inequality. Income inequality is defined as “the extent to which income is distributed in an uneven manner among a population. In the United States, income inequality, …show more content…
or the gap between the rich and everyone else.” (Inequality.org). Income inequality is still and currently an on-going issue since it first came to the scene and it hasn’t left the scene to this very day. There are over millions of families that their wages have been affecting the to live along with millions in poverty. Is that morally wrong for these families to suffer? The wealthy somehow have a lower tax rate then everybody else. Is that morally wrong to have the rich barely get taxed? From the viewpoints of historical, economic, social/cultural, and ethical viewpoints, I believe that income inequality can be considered perfectly moral and morally wrong at the same time. Before we can begin to dissect the issue, we first must go back to the past as every problem always starts out somewhere within its history. It’s been speculated that income inequality was first revealed in the 1970’s. However, before the 1970’s, the economy was prospering as the final years of World War II to the 1970’s showed substantial economic growth for the U.S. This was known as the “golden age,” a time of peace and where true capitalism shined in the U.S. World War II had created more jobs then destroyed, helping veterans find labor once again. The economy during these years had low unemployment rates, low inflation, very high output growth and very high investment rates. The Bretton Woods system was an new monetary system designed to help economic growth after WWII. One of the many things the Bretton Woods system did was that “the gold-value of one dollar (fixed at $35/1 oz fine gold until 1971) was the core of the international monetary system.” (Gloveoff). But, as our history has shown us, the great things in life never last. We often compare the economy to a child with a balloon. When the child keeps on blowing into the balloon, they don’t wanna stop blowing it as it’s fun to them. The child keep on blowing the balloon, until the point it pops because there’s too much air. Then the child cries for a little bit. And then the child get a new balloon and repeats the process over and over again. The economy is just like that analogy. During the late 1960’s, the economy started to exhausted itself as the rate of profit began to decline. The rate of profit is “a measure of the monetary return that a company, industry or economy gets from the sale of its products in relation to the total stock of capital previously invested.” (Gloveoff). Part of this also has to do with globalization and the advancement in technology. Machines started to take over, which meant less jobs for people to put into the economy. Another factor that contributed to income inequality is the emergence of women in the workforce in the 1970’s. This helped depress wages because employers now have a larger labor pool to choose from. Women, including single woman, were armed with the money have contributed to corporate profits and shareholder wealth with their increased spending. There’s a lot more possible causes to income inequality as the list goes on and on, but, this is the general idea of some of the causes to income equality and the effects. While some of these causes are moral as the economy will eventually start to dwindle itself eventually, some can be morally wrong to have machines take over people. Yes, from a business perspective, you want to save money and time, but, you take away the abilities of individuals. Economically speaking, income inequality is morally wrong and normal.
Robert Reich, an American political commentator, professor, and author who was Secretary of Labor under President Bill Clinton, says “in the United States, consumer spending accounts for approximately 70 percent of economic activity.” (Robert Reich). Our economy relies on the consumers, aka you and me, to spend and put money back into the system. If we can’t do that, then that’s wrong and we’re all still going to be in trouble. In the critically - acclaimed documentary “Inequality For All,” by Jacob Kornbluth, starring Robert Reich, Reich had come up with two cycles of theories. One of these cycles being called the virtuous cycle. The virtuous cycle is a cycle of security and well-being for the U.S economy. The virtuous cycle is as follow in order: “Economy expands, productivity grows, wages increase, workers buy more, companies hire more, tax revenues increase, government invests more, workers are better educated.” (Inequality For All). They all follow a loop for the economy. However, on the flip side, there’s the vicious cycle; the polar opposite of the virtuous cycle. The vicious cycle is when the economy goes downhill. The vicious cycle is as follow in order and loops: “Deficits grow, wages stagnate, workers buy less, companies downsize, tax revenues decrease, government cuts programs, workers are less educated, unemployment rises. (Inequality For All). While these cycles were to explain the economy before and after the 1970’s, both cycles are reflected to today’s
economy. Socially and culturally, income inequality is principled and principally wrong at the same time. Before our society today, back in the medieval times with the life of the peasants, even the peasants were mistreated like the poor today. In chapter XVI of William Stearns David’s novel “Life on a Mediaeval Barony,” David explores the rural life of peasants life in the thirdteenth century. The abundant social classes were broken up into the following “Clerks, knights, peasants” (David 253). The peasants being the poor, the knights being the middle class and the clerks being the higher class. Peasants were subjected to tremendously onerous taxation during this time period. “Even a well-disposed lord looks on a peasant largely as a source of income. In time of peace the taxes and forced labor squeeze out of him...” ( David 257). That’s similar to what is happening today; the poor is look down upon by the wealthy, the poor is paying the most in taxes, their bodies are drained out of them physically and mentally with their labor while still trying to surviving in this world, while the rich are enjoying life without no scratch. That’s morally wrong in a sense to abuse the people who have no choice to take the horrible paying job with the conditions they have to endure everyday. At last, the main argument and subtopic of this entire paper. Ethnically, income inequality is moral and morally wrong. The main debate comes from rational morality vs egalitarianism Egalitarian is defined as “a belief in human equality especially with respect to social, political, and economic affairs; a social philosophy advocating the removal of inequalities among people” (Merriam-Webster ). In other words, everyone is equal and there’s no inequality to all aspects of human life. While that sounds superb, there’s more to egalitarianism than its definition. The issue with egalitarians is that you are consider to be morally suspicious if you acquire more wealth or income then another human being. That means you must be subdued to the equalness and fairness of egalitarianism, and you can never go above and beyond your capabilities in society. Egalitarians turn the word “equality” into a metaphysical quality; the equality of individual properties and excellencies, paying little heed to normal enrichment or individual decisions, execution and character. Egalitarians don't have faith in man-made establishments ,but, faith in nature itself. However, there’s a major problem with them believing in nature. Nature does not endow people with equal beauty, equal intelligence or equal levels of direction and ambition. We are all made up of our own pluses and minuses. We have inalienable rights and everyone is equal by law, but, not by nature. We’re not even morally equal, and the faculty of volition leads people to make different choices than others. In a sense, egalitarianism can be considered the social/ethical version of communism. Ari Armstrong, a writer and blogger who’s written publicans for Denver post says “. A rational morality calls for a government that protects the rights of every individual—rich, poor, and in between—to produce and trade by his own judgment and for his own benefit, and to keep and use his wealth as he sees fit.” (Armstrong). An egalitarian does the exact opposite as “Egalitarianism promotes a government that shackles the most successful producers and seizes their wealth for unearned distribution to others.” (Armstrong). It’s morally wrong to take away from the legitimate wealthy who earned their wealth through hard work and ambition. As this research comes to an end, no matter which side of the seeshaw you examine it from, income inequality is both moral and morally wrong. It’s morally wrong to have millions in poverty, but, also morally wrong to blame the wealthy and take away their hard earned wealth. There are various solutions that could potentially end income inequality. Having a strong middle class is the big key in changing inequality to equality, so that’s where the focal point should be at. The middle class is the representation of the country, what many call the “american dream.” Investing in education can help solve the issue at hand. Taxing the rich at a higher tax rate can also cure a bit of the wound. Many media outlets like CNN, Fox News, and even in the presidential debates, income inequality is an issue everyone talks about. However, we shouldn’t be focusing on fixing income inequality but rather social mobility. Because there’s always going to be an unfairness when it comes to the economy. We should focus on helping households across the U.S by encouraging them to stay together rather than splitting up. Also improving our school system and being involved in our communities are even more steps to take. If such steps are taken to action, we can have equal opportunity for all, not equal fairness for all, which is the real key to fixing our economy; having households and individuals that work hard, smart and that deserve it by giving them better opportunities at improving economically and finally then rather being fair to all. If we can follow this right path, it’s a path we don’t have to look back upon anytime soon.
David J Lynch says that, “ [s]ocieties that manage a narrower gap between rich and poor enjoy longer economic expansions”, however, in the United States the gap between the have and have-nots has widened (source C). “This country is just getting worse and worse and worse … and that is not a recipe for stable growth” (source C). If we do not do something soon our capitalist country will fall. In order for the income inequality gap to lessen to create a more stable economy the government must invest in education and unionize workers and not provide higher taxation for the top one percent.
Inside of this video, this guy really targets an issue nobody has really been presented. He shows charts that talk about how we Americans think our wealth is distributed. We think distribution is doing alright. Americans think that the bottom 40% is getting a bit of money. They also believe that the middle class is doing reasonably well. Unfortunately, that is not the case. In the video, he breaks it down a little bit getter. He shows a graph that shows how money is actually being distributed. The poorest of poor don 't even register on the poverty line. The middle class is barely making it. And then there is this huge difference between "the rich" and the poor. It is proven that the 1% of America has 40% of the entire nation 's wealth ("Wealth Inequality in America."). The bottom 80% of America only share 7% of the nation 's wealth among themselves. The top 1% has 50% of the stocks, bonds, and mutual funds. The bottom 50% of Americans only own 0.5% ("Wealth Inequality in America."). The poor is not just getting by but they are scraping and fighting to get by. Now that it is clear that there is a lot of poor people in America, it is important to figure out how to fix
The highest earning fifth of U.S. families earned 59.1% of all income, while the richest earned 88.9% of all wealth. A big gap between the rich and poor is often associated with low social mobility, which contradicts the American ideal of equal opportunity. Levels of income inequality are higher than they have been in almost a century, the top one percent has a share of the national income of over 20 percent (Wilhelm). There are a variety of factors that influence income inequality, a few of which will be discussed in this paper. Rising income inequality is caused by differences in life expectancy, rapidly increases in the incomes of the top 5 percent, social trends, and shifts in the global economy.
A plethora of research studies exist on the topic of wealth inequality in America. There is no question that the top one percent of earners consume a large portion of wealth in this country while the other 90 percent of earners share the left-overs. Some of the related questions that I found during the course of my research are 1) Why are wealth and income distributions so vastly disproportionate? 2) Can America bridge the wealth gap? 3) If so, how? 4) Has the wealth gap increased over time? 5) Are there public policies that influence wealth inequality? And, 6) Is America’s middle-class growing poor? Those are just a few of the many questions that circulate the discussion on wealth inequality in America. However, the two
In the United States there are four social classes : the upper class, the middle class, the working class, and the lower class. Of these four classes the most inequality exists between the upper class and the lower class. This inequality can be seen in the incomes that the two classes earn. During the period 1979 through the present , the growth in income has disproportionately grown.The bottom sixty percent of the US population actually saw their real income decrease in 1990 dollars. The next 20% saw medium gains. The top twenty percent saw their income increase 18%. The wealthiest one percent saw their incomes rise drastically over 80%. As reported in the 1997 Center on Budget's analysis , the wealthiest one percent of Americans ( 2.6 million people) received as much after-tax income in 1994 as the bottom 35 percent of the population combined (88 million people). But in 1977 the bottom 35 percent had about twice as much after tax income as the top one percent. These statistics further show the disproportional income growth among the social classes. The gr...
Wealth inequality is a real issue that needs to be fixed. The imbalanced growth of the upper class compared to the middle class is a danger to American society as a whole. The rich becoming richer while the middle class remains the same leads to a power imbalance, with the rich using their money to run the country the way they see fit while the middle class speaks to ears that do not listen. The issue of wealth inequality needs to be fixed by raising taxes on the rich.
Income inequality not only harms us fiscally, but also affects our mental and physical wellbeing; therefore, it is important to identify the right ways to control wealth distribution among people.
The United States has a pervasive issue of income inequality (Volscho & Kelly, 2012). While the wealthy few live in absurd abundance, poor hardworking individuals often cannot afford basic necessities. Such a dynamic is not only an affront to the ideals of equality of opportunity, but also may increase crime as a result of relative deprivation and lack of legitimate opportunities to achieve (Thio, 2010). This essay describes the magnitude of income inequality in the United States, reveals barriers that obscures its magnitude, and suggests a starting point from which corrective measures might develop.
3. What are the effects of this wealth inequality in the US and what causes it, as well as some possible solutions and their ramifications, will all be discussed and answered below. There has always been a wealth gap between the richest and poorest in society. However, in the past decade, the wealth gap between the richest and poorest citizens in the US has been growing rapidly. In the 70s and 80s, the wealth and income growth rate for both poor and rich people were similar, however, between the years 2009 and 2012 the top 1% income increased 31% while for the bottom 20%, their income actually dropped and for the vast majority of Americans, the average yearly income only increased by 0.4% [4].
Reich, Robert B. “Why the Rich Are Getting Richer and the Poor, Poorer.” A World of Ideas:
Inequality exist and is high in America because the amount of income and wealth that is distributed through power. In America the income distribution is very inequality and the value of a person wealth is based on their income with their debts subtracted. “As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers)” (Domhoff, 2011). In contrary the poor do not get ahead and the rich get more. Americans are judged and placed in class categories through their home ownership which translates to wealth. Americans social class is often associated with their assets and wealth. “People seek to own property, to have high incomes, to have interesting and safe jobs, to enjoy the finest in travel and leisure, and to live long and healthy lives” (Domhoff, 2011). Power indicates how these “values” are not distributed equally in American society. Huge gains for the rich include cuts in capital gains and dividends and when tax rates decrease for the tiny percent of Americans income is redistributed. Taxes directly affect the wealth and income of Americans every year.
Income inequality has affected American citizens ever since the American Dream came to existence. The American Dream is centered around the concept of working hard and earning enough money to support a family, own a home, send children to college, and invest for retirement. Economic gains in income are one of the only possible ways to achieve enough wealth to fulfill the dream. Unfortunately, many people cannot achieve this dream due to low income. Income inequality refers to the uneven distribution of income and wealth between the social classes of American citizens. The United States has often experienced a rise in inequality as the rich become richer and the poor become poorer, increasing the unstable gap between the two classes. The income gap in America has been increasing steadily since the late 1970’s, and has now reached historic highs not seen since the 1920’s (Desilver). UC Berkeley economics professor, Emmanuel Saez conducted extensive research on past and present income inequality statistics and published them in his report “Striking it Richer.” Saez claims that changes in technology, tax policies, labor unions, corporate benefits, and social norms have caused income inequality. He stands to advocate a change in American economic policies that will help close this inequality gap and considers institutional and tax reforms that should be developed to counter it. Although Saez’s provides legitimate causes of income inequality, I highly disagree with the thought of making changes to end income inequality. In any diverse economic environment, income inequality will exist due to the rise of some economically successful people and the further development of factors that push people into poverty. I believe income inequality e...
Economics of Reich “Why the Rich are getting Richer and the Poor, Poorer” written by Robert Reich, describes as the title says, why the rich are getting richer and the poor, poorer. In Reich’s essay, he delves into numerous reasons and gives examples of each. It makes one wonder if the world will continue on the path of complete economic separation between the rich and the poor. One very important factor Reich examines in his essay is that large corporations are always trying to find the edge, whether that is new technology or cheaper wages. One may ask, how does that affect me?
Wealth inequality is the uneven distribution of resources in a given state or population, which can also be called the wealth gap. The sum of one’s total assets excluding the liabilities equates the person’s wealth also known as the net worth. Investments, residents, cash, real estates and everything owned by an individual are their assets.In reality, the United States is among the richest countries in the world, though a few people creating a major gap between the richest, the middle class and the poor control most of its wealth. For more than a quarter of a century, only the rich American families have shown an increase to their net worth.Thisis a worrying fact for the less fortunate in the country and calls for assessment (Baranoff, 2015).
Income inequality continues to increase in today’s world, especially in the United States. Income inequality means the unequal distribution between individuals’ assets, wealth, or income. In the Twilight of the Elites, Christopher Hayes, a liberal journalist, states the inequality gap between the rich and the poor are increasing widening, and there need to have things done - tax the rich, provide better education - in order to shortening the inequality gap. America is a meritocratic country, which means that everybody has equal opportunity to be successful regardless of their class privileges or wealth. However, equality of opportunity does not equal equality of outcomes. People are having more opportunities to find a better job, but their incomes are a lot less compared to the top ten percent rich people. In this way, the poor people will never climb up the ladder to high status and become millionaires. Therefore, the government needs to increase all the tax rates on rich people in order to reduce income inequality.