The Gap Between Rich And Poor In The United States

In the United States, high standard of living is not equally shared with in the Americans. The 1970s and 1990s was period where economic inequality began to grow. Emmanuel Saez, an economics professor at UC Berkeley has been doing a research for the U.S. income inequality. He states that there has been an increase since the 1970s, and has reached levels that have not been seen since 1928. “In 1928, the top 1% of families received 23.9% of all pretax income, while the bottom 90% received 50.7%. But the Depression and World War II dramatically reshaped the nation’s income distribution, by 1944 the top 1%’s share was down to 11.3%, while the bottom 90% were receiving 67.5%, levels that would remain more or less constant for the next three decades. But starting in the mid- to late 1970s, the uppermost percent income share began rising dramatically, while that of the bottom 90% started to fall.”(DeSilver) Ever since then, economic inequality continues to increase, especially in the last three decades.

In other words, America has a widening gap between its wealthy and poor. As the rich get richer and the poor get poorer, there is a problem emerging: the disappearance of the middle class. Low-wage workers continue to fall behind those who make higher wages, and this only widens the gap between the two. There has been an economic boom in the United States, which has made the country more prosperous than it has ever been. That prosperity does not reach all people; it seems to only favor the rich. Rising economic segregation has taken away many opportunities for the poor to rise in America today. The poor may find that the economic boom has increased their income; however, as their income increase so does the prices they must for their living expenses (Dreier, Mollenkopf, & Swanstrom 19).

Poverty affects millions of people living in the united states, poverty is measured by the amount of money needed to support the basic needs of a house hold. Poverty is measured by the SSA low-cost food budget assuming 1/3 of the budget is spent on food. The people with the highest percentage of poverty is shown to be Hispanic female households with no spouse present. The vast majority of people in poverty are women and children but in recent years the numbers of women considered poor have raised. Percentage rate is the percentage of poor in different counties. Looking at graph that maps Americas diversity shows that the highest poverty rate is in the South the Midwest has the least. I would assume that has to do with the weather, warmer weather

From 1938-1969, in America was in a period called the great compression, a time where the difference between the richest and poorest Americans was very small and economic growth was explosive. Due to past and current economic policies and events, income inequality has exploded in America, which is why in 2015 America had the highest level of wealth inequality in the world at 80.56 gini[1] . In the future this inequality will slow down economic growth, increase debt for middle income Americans, make America less democratic, and reduce economic mobility. This problem, however, does have solutions and this paper will lay out some of the solutions and the effect they will have on the economy, but first I will explain the history of income inequality in the US.

In a research of Harvard professor 5000 people in America have opinion in how they think about the actual distribution of wealth in the U.S. and the 92 percent choose the ideal would be 20 percent and 20 percent the middle class. However, the reality is very far from it. “The poorest are not even registered, they are on the package change and the middle class is barely distinguished from the poor, even the rich between the 10 % and 20 % are worst off, only the top 10 % are better off. Only the one percent gets ten time higher and 40 % all the nation wealth. The bottom 80 % 8 out 10 people only has 7 % between them.1 % makes a quarter of the national income today”(you tube, 2015). All of this data reflex one of the truly perspectives in economy of the U.S. Not only people with low wages are the most affected, but also those who have good jobs and

The last issue concerning wealth inequality is the health and well being of the lower class. The high rates of social problems: lower rates of performance in school, life expectancy, incarceration, teenage pregnancy along with health problems like obesity and heart disease are directly effected by the United States high inequality. The reason for poor school performance is that children of the lower class typically do not plan on going to college because they cannot afford it. If they do not plan on going to college, they don’t believe there is a reason to put a lot of effort and succeed in high school.

Presently the United State 's income gap between the middle class and wealthy is undoubtedly significant. Some say that income inequality is

Americans today live in a distinctly unequal society. Inequality is now wider than it used to be in the last century, and the division in income, wages, and wealth are broader than they are in other developed economies of the world. Wealth inequality is the imbalance of wealth or income within a society, and it is one of the most vital economic challenge the US is facing today because the distribution of wealth is more dispersed, making the inequality in wealth distribution at its highest. While the matter has been discussed for many years, the actual income disparity in the U.S. has heightened and is now verging on an extreme gap that portends to impede long-term economic growth. The huge gap between the wealthy and poor is squeezing the U.S. economy, the wealth gap threatens economic growth by diminishing social mobility and producing a less-educated workforce who are not able to compete in the global economy. unrestrained level of income inequality causes political pressures, it discourages trade, investment, and hiring. The present level of income inequality in the U.S. is shrinking GDP growth, and the world's largest economy is struggling to recover from the Great Recession.

The difference of income and workers conditions has been a timeless conflict present throughout history of the United States. In the past workers were faced with deadly work conditions and around the clock hours for little pay. These unjust conditions dramatically increased during the Industrial Revolutions that the United States experienced in the nineteenth century. The latter period of industrialization produced the organization of the first labor unions in the Country, namely the Knights of Labor established in 1869 and the American Federation of Labor established in 1886. In present day countless unions exist, and are a lot less needed than they were in the early industrial days of the United States (Brinkley, 2012).

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.

Also income is less concentrated than wealth. Also the Federal Reserve’s Survey of Consumer Finances (SCF) is the main source to obtain information related the allocation of wealth for household. The SCF income distribution received approximately a third of all income in 2013 data also shows that the top 3 percent of the, while the top 3 percent of the wealth distribution held 54 percent of all wealth (Stone, et al).  Similarly, the top 10 percent of the income distribution received a little less than half of all income, while the top 10 percent of the wealth distribution held three-quarters of all wealth. In fact, the average wealth has amplified over the past 50 years, but it has not developed equally for all groups

Capitalism has been the central force behind the growth of the United States’ progressive economy. Within such advanced economic system the chances of economic disparity are significantly high. In fact, over the past three decades there has being a steady increase in unequal wealth distribution among the economic classes. To sustain the current unequal wealth distribution among the classes of the American population, there are numerous factors that influence and shape this trend. For some members of the population it is alarmingly disturbing to know that recent statistics have shown that, “In the US [alone] the wealthiest 1% of its population owns more than the bottom 95 %” (Gutman). As for the difference in economic wealth, it resulted

One of the social issues concerning power, status, and class in American society today is income inequality. The income gap between the social classes has increased drastically throughout the last few decades, creating a significant gap between the wealthy and the poor. This gap has become so large that the middle class has nearly diminished, creating a social class comprised of the rich and the poor. The significant gap between the two social classes is unhealthy for the economy because it provides too much power in the hands of those with high social status.

A major social problem in America today is its inequality of the distribution of income. "Income inequality refers to the gap between the rich and the poor. The United States has the most unequal income distribution in the industrialized world, and it is growing at a faster rate than any other industrialized country" (Eitzen & Leedham, pg. 37). The main reason as to why income is distributed so unequally is because of the gap between social classes.

The era of volatility has created a shift from America being the middle-class society to simply rich or poor (Sachs, 2011). A gap this large has not been experienced since the 1920’s (Sachs). “The top 1% of households takes almost a quarter of all household income” but an economy this top heavy will not be able to succeed (Sachs, 2011, p. 30). The working classes are struggling with housing, wage, and employment issues. Rich individuals are ignoring these troubles, shipping their business operations out of the country, thus furthering the downward spiral of the economy (Sachs). To make matters worse, this has become in a large part a political issue, because the rich can influence candidates with funding, where the poor and working