Inequality What is it? Income inequality is the unequal distribution of household or individual income across the various participants in an economy. Income inequality is often presented as the percentage of income to a percentage of the population. Stated in Ineqaulity.org “Income includes the revenue streams from wages, salaries, interest on a savings account, dividends from shares of stock, rent, and profits from selling something for more than you paid for it.”(Inequality) It also eludes to income as being distributed in an uneven manner among a national population.The gap between everyone else and the rich has constantly been growing since the year 2000. Inequality can be defined or measured in a number of different ways.
Inequality exists around us and Americans more and more each day are asking one question, Is America becoming more unequal? The United States is one of the richest but unequal nations in the world. Compared to every other country, our level of inequality is similar to Malaysia and Mexico, unlike comparing to Western Europe and East Asia (rich nations) who have much lower levels of inequality. Income inequality refers to the amount to which income is distributed in an uneven manner among the population. In the United States, income inequality has been growing strikingly for some thirty years.
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.
(2006)). As the years went on in our country, inflation increased and the value of the dollar has decreased. Many folks are working average jobs to make ends meet and the cost of goods and services in our country are growing fast but the wages are not. Although income inequality is a huge factor to stature of our economy, according to the National Review article, Liberals identifies income inequality as a major concern, as it leads to more problems such as home loss and not being able to make ends meet. Also as stated in the article, the poor and middle class are quickly falling below the wealthy, wages not increasing or weak jobs.
All around the glob economic inequality has risen. Economic inequality is the economic gap between the income and wealth of the richest people in the world compared to the poorest. Specifically, in the United States, economic inequality is the highest it has ever been. According to the Organization for Economic Co-operation and Development (OECD), in 2008 the average income of the top ten percent of Americans was nearly fifteen times higher than that of the bottom ten percent (“Social Welfare Issues”). Those numbers have risen even higher today.
Failure of U.S. labor market to distribute gains: a cause of poverty The issue of poverty in the United States is complex, and no one root cause is sufficient to explain why, in a wealthy developed nation, such poverty should exist. However, a principal factor which may contribute to the nation’s poverty lies in problems with the U.S. labor market. According to Freeman, while the U.S. has witnessed a “substantial growth in GDP per capita” (20), only a relatively small portion of the population, the wealthiest Americans, has seen the benefits of that rise in GDP. Many poor and working class Americans do not have access to this wealth and receive little actual benefit from the nation’s increased wealth and prosperity. While productivity has increased in recent years, the gains from the nation’s economic growth has not increased the real wages and benefits for U.S. workers (Freeman 20).
The less educated immigrants are usually willing to work for low wages. Since many of them are not US citizens, they are not protected by the US labor laws (Stelzner). Many employers exploit this knowledge (that they are not US citizens) to pay them meager wages. This has the effect of lowering wages since many US citizens are compelled to lower their wage demands to compete with the low wage demands of the immigrants (Stelzner). The result is that employers (the rich) are able to increase their profits and earnings, as the wages employees (poor) plummet due to immigration.
Leaving 55 percent left which makes them either rich or poor, meaning most of America is included in the class between. If that is true then it is fair to say that middle class Americans are a large contribution to the economy and circulate most of the money in it. After realizing the middle class’ role in America, it would be reasonable to also understand why it would be a problem if something bad should happen to it. Income inequality is a rising problem that has been affecting America’s economy. The result of income inequality is the diminishing middle class.
The number of families with incomes over $100,000 has been growing, more than the other categories. The gap in the corporate world is just as bad. CEOs salary increases disproportionately to that of the lower end workers. (book pg 21-34) There are also tax cuts to consider. Many countries use taxes to more evenly distribute and regulate the hording of income.
Case 2: Income Inequality Christopher Hodges Curtis Griffie Berry Epley Campbell University BADM 742: Business Ethics July 7, 2015 “Income inequality refers to the extent to which income is distributed in an uneven manner among a population. In the United States income inequality is the gap between the rich and everyone else which has been growing markedly by every major statistical measure for approximately 30 years” (Aguiar 2013). Wealth inequality has a close relationship with income inequality due to the nature of not needing a sizeable income because of wealth that was handed down for generations. The supposed problem doesn’t originate from the slogan, “The rich is getting richer and the poorer are getting poorer”