Assignment On Income Inequality : Extinction Of The American Dream

Think about your goals that would lead you to your definition of the American Dream. Would you let economic differences ruin your dream, or work harder? The American Dream would be considered reaching your ultimate goal and having a stable life and job to provide for oneself and their family. Most people in our country think that the main reason why the American Dream is dying is because of income inequality. Income inequality can play a huge role in why people’s financial situations have a toll on their goals.

Along with globalization market forces has had the greatest impact on income equalities in the United Sates. Thomas Piketty says that “by definition, in all societies, income inequality is the result of adding up these two components: inequality of income from labor and inequality of income from capital. The more unequally distributed each of these two components is, the greater the total inequality ... [a] decisive factor is the relation between these two dimensions of inequality: to what extent do individuals with high income from labor also enjoy high income from capital? Technically speaking, this relation is a statistical correlation, and the greater the correlation, the greater the total inequality, all other things being equal” (Piketty & Goldhammer, 2014, p. 242). In the U.S. the correlation between the two dimensions has become so astonishing that “President Obama called economic inequality “the defining challenge of our time.” But while Americans acknowledge that the gap between the rich and poor has widened over the last decade, very few see it as a serious issue. Just five percent of Americans think that inequality is a major problem in need of attention” (Fitz,

Income Inequality in America is a problem that’s been going on for decades, and many feel that it hardly exists, the many people that feel that way are highly uneducated, and seem to not really care about this tremendous problem that in one’s eyes really has no end in the near future, in fact it has been gradually rising and one feels that it’s just not fair. Unfortunately, there’s not much that can be done, only of course if the poor class of people decide to actually educate themselves and get a higher education. One says poor class, simply because that’s how they’re classified. There are five types of levels that Americans are classified as, and they are: 1. Upper Class, 2. Upper Middle Class, 3. Middle Class, 4. Working Class, 5. Poor.

In today’s capitalist economy, where economic transactions and business in general is centered on self-interest, there is a natural tendency for some people to make more than others. That is the basis for the “American Dream,” where people, if they worked hard, could make money proportional to their effort. However, what happens when this natural occurrence grows disproportional in its allocation of wealth within a society? The resulting issue becomes income inequality. Where a small portion of the population, own the majority of the wealth and the majority of the population own only a fraction of what the rich own. This prominent issue has always been the subject of social tension

The book called They Say I say with Readings contains multiple articles. However, chapter nineteen focuses on the American Dream. Chapter nineteen, “What’s Up with the American Dream?” indicates how the article will be focusing on the American Dream. The American Dream changes over the course of time as the income inequality widens between the higher and lower class. Few events occurred that affected the income, which led to a growing gap between the different classes. The income of a person depends on the education that a person possesses, which can affect one’s income. Consequently, causing inequality between the different classes. People believe the American Dream changes over time as situations and circumstances vary. Health care is affected by the income inequality because different choices of insurances and doctors are available to those with specific incomes. The impact of the Income Inequality on the American Dream by the gap increasing between higher and lower class, education, interpretation of the American Dream over time, health care, and gender roles. Various authors from chapter nineteen and others from different resources focus on how income inequality affects the American Dream.

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The issue of income inequality in the United States is complicated and does not have a definite answer. Income inequality can be measured in a few different ways. The first measurement for the income inequality in a country is to look at the percentages on households and group them into income categories, called distribution by income category. The second measurement for income inequality is called distribution by quintiles or fifths. This is when you divide the total number of people, households, families into five groups called quintiles to examine the percentage of total before tax income received by each quintile. Each quintile would then be ordered by income and households in the category.

Furthermore, when analyzing the different classes, and the distributions of wealth and income in the United Sates; for instance, the upper, middle, and lower classes – it is an astronomical amount of wealth that the top 1 percent acquire. It is also noted by Johnson & Rhodes (2015), “that income and wage inequality have risen sharply over the last thirty years” (pg. 228). Equally important to this, is how the average change in income is divided in Americas quintiles and the widening gaps. For example, in Table 5.2, while the lowest fifth quintile increased from $11,128 to $11,361 – a difference of $233.00 from years 2006 to 2012; the highest quintile increased from $289,446 to $319,918 – an exponential increase of $30,472 (pg. 229). With income inequalities at this rate, it is difficult for the majority of the United States to experience upward social mobility. Pursuing this further, in a line stated by Johnson and Rhodes (2015), “The wealthiest Americans can live on the dividends from their investments without having to touch the principle or work for a salary” (pg. 230). From this, it is visible to see how society has compartmentalized different levels of functions to keep a so called balance for the greater

America prides itself on being one of the most successful democratically governed counties. The idea of the American dream is that all citizens have equal civil liberties and a responsive government. However the effectiveness of democracy is being threatened by increasing inequality in the United States. “The dominant view holds that economic development and modernization are the key to the continued growth of democracy” (Snider and Faris 2001; United Nations, 2011). In the last decade especially the American Society has had significant moments of increasing equality. In 1960 the Civil Rights Movement changed how different races were viewed. Also in the 1960s the Women’s Right Movement push for equal rights between genders. Both of these

Chapter 2 was interesting and informative. First, I would like to state that changing demographics, globalization, and household composition are a few of the things which have contributed to income inequality.

“One reason to care about inequality is the straightforward matter of living standards. The lions share of the economic growth in America over the past thirty years has gone to a small, wealthy minority…”(Krugman 586).

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.

Do you think the American dream is still a concept today? If so, is it still possible to achieve this American dream? The American dream can be described as the success of life, and the goals achieved. Sometimes, these dreams can not be achieved due to obstacles. In this case, obstacles such as inequality. Many may view America has the land of opportunity and the greatest nation ever due to our vast diversity and freedom, but is this thought to be true in America itself? There has been many cases of people facing inequality in history. Examples of inequality were unequal rights against African Americans, against women, and one that is more common today is the income inequality. Inequality makes it so the people who are made to be inferior have many obstacles to face, such as racism or being degraded as humans. African Americans were slaves and women did not get equal opportunity compared to men. Although inequality may seem like a thing in the past, many still face it today. Inequality limits a person from succeeding in his or her life, and puts a great struggle upon them.

Every American dreams of finding a job that pays well enough so that they may comfortably take care of their loved ones and themselves for years to come. Most Americans hope to find some way to make a living that they enjoy, something that they view as productive. Unfortunately, many do not have this luxury. In our society, a good portion of the population is forced to hold the base of our country in place while hardly being redeemed for their time and effort, and thus the problem of income inequality. Numbers of these people live from paycheck to paycheck, barely getting by, not because they manage their money poorly, but because the value of their time at work is negligible.

Many Americans believe that America has one of the most powerful economies that is involved in the global market and the best average living standards. Since the creation of the United States it has been known as the land of endless opportunities, regardless of social or economic classes. Under this philosophy, all citizens should have equal rights and given equal opportunity to progress in the workforce. However many Americans are living full lives and do not have financial obstacles to get over. Even so, millions of Americans are still faced with poor living conditions and struggle with providing for their families basic needs. Whether Americans believe poverty and inequality exist in America exists or not, the authors in three different articles:” Culture of Success” by Brink Lindsey, “A Great Time to Be Alive?” by Matt Yglesias, and “Born Poor and Smart” by Angela Locke, and “The War Against the Poor Instead of Programs to End Poverty”by Herbert J. Gans, shared ideas on how to help fix the problems of the impoverished community and address the cause of the problem. The four articles also explain different biases that the impoverish have to endure everyday.