In Paul Krugman’s, Confronting Inequality, he illustrates how economic inequality affects America, as well as identifies steps to resolve the gap between the upper elite and lower class. He claims that economic growth has gone to the wealthy minority; meanwhile, there is a lack of economic growth for lower and middle-class families. The upper elite can afford to stay a night at a luxury hotel with an eleven thousand dollar per night rate, while middle class families are buying homes they cannot afford, so their children can be placed in good schools. Paul Krugman suggests that by undoing tax cuts for the wealthy, the limit of inequality would be lessened. He includes, “from the New Deal until the 1970s[,] it was considered normal and appropriate to have ‘super’ tax rates on very-high-income individuals” (572). To be effective, though, taxes would also have to be raised for the middle-class. Also, an increase in minimum wage would create a direct benefit for those currently paid less than the minimum, and the increased minimum would ripple, so even those paid above minimum wage would benefit. Lastly, Krugman promotes unions by stating they often raise and equalize wages for members. …show more content…
It is true that there is a large gap between the upper elite and lower class.
Expenditures of the wealthy are wants rather than needs. Meanwhile, the very small middle class that remains can barely afford homes as they tend to buy in nicer neighborhoods, so their children will be districted to attend a good school. However, is it not to say that if many of the middle-class families were to learn and experience how to budget and manage money well, they would not encounter large debt? Moving into a home a family cannot afford is the first issue. Once they dig themselves into a large hole of debt in mortgage, it is rare the family has even thought of putting money towards a college fund. Debt only leads to more
debt. Secondly, one of America’s greatest strengths is allowing citizens and immigrants the opportunity to do what they please; meaning, there is no one standing beside a line of people labeling them with their assigned occupation. As Americans, the fate of your occupation, and furthermore the pay, is largely in the hands of the people. That is something that has lasted since the 1970s. Government support has created a minimum wage so that employees are not working tediously, in difficult occupations and only earning two dollars per hour. Raising the minimum wage would surely increase income versus cost of living for some for a short period of time, but as Krugman mentioned, this effect would ripple. It is not that employees with raised wages would now benefit, though. Raising minimum wage would only cause inflation in the nation’s economy. In Krugman’s case, raising minimum wage also would not create a stronger middle class. As the lower class earns more, the middle and upper class will also earn more. As a result, businesses will likely see a need to raise their prices to once again level their supply and demand. Therefore, an increased minimum wage may appear to be larger when looking at the number, but only after seeing it in action will Americans realize it will have little to no effect.
According to Gregory Mantsios many American people believed that the classes in the United States were irrelevant, that we equally reside(ed) in a middle class nation, that we were all getting richer, and that everyone has an opportunity to succeed in life. But what many believed, was far from the truth. In reality the middle class of the United States receives a very small amount of the nation's wealth, and sixty percent of America's population receives less than 6 percent of the nation's wealth, while the top 1 percent of the American population receives 34 percent of the total national wealth. In the article Class in America ( 2009), written by Gregory Mantsios informs us that there are some huge differences that exist between the classes of America, especially the wealthy and the poor. After
We, as Americans, view inequality one way, while Krugman perceives it rhetorically. This rhetorical view represents his signal to us, stating the fact that our society changes continuously. “The America I grew up in was a [...] middle class society. Over the past generation,
In this paper, Gregory Mantsios compares and contrasts class in America. He uses facts to support his point that things are getting better for the upper class, while things are increasingly getting worse for the middle and lower classes. Throughout the paper, he demonstrates comparing and contrasting by using “myth” versus “reality”.
Going back to 1978, the typical male worker was making around 48,000 dollars per year while the average person in the wealthy group of the 1 percent earned 390,000 dollars per year. By 2010, the typical male worker earned less than in 1978 whereas the person in the top 1 percent earned more than twice as much as before. Today in America, 400 people have more wealth than half the population of the United States. Reich explains that a strong middle class is what gives our economy stability. This leads to the fact, that 70 percent of the economy is based on the consumer. If the middle class’ wages declin...
Recently, the recession has increased the wealth gap resulting in the rich getting richer and the poor to get poorer. This is an important issue facing society. As the poor and the middle class struggle for financial stability and wealth the top 1% of the rich continue to grow their assets. What is the reality of this issue? Is society’s perception of this issue accurate? How does one’s socioeconomic status influence success? There are many perspectives to this provocative topic and can vary when looking at them through an economical or a political lens. Often times, the wealthy are privileged with an unfair advantage over the poor.
The more inequality in the American economy could end up costing our society to lose many opportunities (231-4). On top of that, the broadening class gap may lead to decreasing political participation and civic engagement, which could further split the classes (234-7). Putman believes the gap between rich and poor has now become epistemological – the wealthy simply don’t know much about the lives of the lower classes. The chapter offers multiple solutions to the problem but they are small and would with no doubt have little effect on the upward mobility of lower income
Later in his article, Cohen explains how this leaves middle-class families in a very uncomfortable situation. Parents or other money-making entities in the household want their student to go to college and earn a degree, but now there can be an element of stress in figuring out how the fees will be paid. Furthermore, many families have to worry about sending multiple children to college in succession, so the cost of college for the children can be quickly overwhelming.... ... middle of paper ...
In Paul Krugmans article Confronting Inequality, he explains the differences between wages of the wealthy and the poor are a problem. Today, America 's middle class is overextending themselves in an effort to give their children more opportunities Many middle class individuals are buying homes that they can 't afford, so that their kids will be attending a good school so that their children can have more opportunities This shows the growing gap between the wealthy and the poor. Robert Frank reports that the rich are creating their own world, away from the middle class and the poor, which supports Krugman 's thesis that there is a growing difference in social equality, which is being caused by the gap between
Divisions within the social stratum is a characteristic of societies in various cultures and has been present throughout history. During the middle ages, the medieval feudal system prevailed, characterized by kings and queens reigning over the peasantry. Similarly, in today’s society, corporate feudalism, otherwise known as Capitalism, consists of wealthy elites dominating over the working poor. Class divisions became most evident during America’s Gilded Age and Progressive era, a period in time in which the rich became richer via exploitation of the fruits of labor that the poor persistently toiled to earn. As a result, many Americans grew compelled to ask the question on everyone’s mind: what do the rich owe the poor? According to wealthy
In Chuck Collins article, “The Wealthy Kids Are All Right”, he compares the lives of four completely different college aged adults. One has the advantage of being brought up in an affluent home, so she leaves college debt free, and on the path to a life of high paying jobs and big houses. The next student had to work his way through college, and graduated with over $50,000 in debt and then spent his entire life trying to break through the thick middle class barrier. Another student went to second rate schools and graduated with little debt; yet, his lack of experience in his field and higher education caused him to be stuck in a steady job despite it being low paying. The last student never pursued secondary education since she had to deal
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...
Inequality today is one of the most significant problems that America faces. According to Inequality.org in 2015 Household income of the top 0.1% of the population gained $6,747,439 while bottom 90% of the population got $34,074 (Inequality.org). The gap between incomes only continues to grow every year, which requires a change in social and economic policies of the country. However, it should be remembered that economic indicators can tell about working conditions, living conditions, nutrition, education of representatives of various groups of the population, but they can not show a picture of the realizability and opportunities to be successful in life for different groups of the population. That is why at the end
Over the last several years in the United States it has become more and more evident that the gap between the rich and the poor is growing. Not only is the gap growing, but the government is doing very little to stop it. Slowly the poor are being shifted away from the center of wealth and being replaced by the already wealthy. It's a shame how a few people with large cheque books can run the most powerful country in the world, and yet the general public are being redirected to think this problem is a minimal and insignificant issue. The truth is that economic and social inequalities have been growing in the United States at an alarming pace. The inequalities exist because the wealthy want to have more, and the power to obtain more; To do so people must give up their wealth and thus cause the economic gap.
Wolff, Edward. “The Wealth Divide: The Growing Gap in the United States between the Rich and the Rest.”
In Confronting Inequality, Paul Krugman discusses the cost of inequality and possible solutions. Krugman argues to say that it is a fantasy to believe the rich live just like the middle class. Then, he goes into detail about how middle class families struggle to try to give their children a better life and how education plays a factor in children’s future lives. For example, children’s ability to move into higher education could be affected by their parents economic status. Also, He discusses how politicians play a role in the inequality, because most of politicians are in the upper economic class. Finally, Krugman says how we could possibly have solutions to these various inequalities, but how America won’t get them because the rich do not