The Grinding Gears Of A Dysfunctional Economy

This inequality stems from the changes within the U.S. economic structure coupled with the changes in our government policy. At least 80% of all citizens work in a service related job. These types of jobs pay far less than the manufacturing jobs that dominated the American economy. With the present economy looking bad, most employers are laying off employees and possibly replacing them with lower paying temporary or

According to Inequality.org, “We equate wealth with ‘net worth,’ the sum total of your assets minus liabilities. Assets can include everything from an owned personal residence and cash in savings accounts to investments in stocks/bonds, real estate, and retirement accounts. Liabilities cover what a household owes: a car loan, credit card balance, student loan, mortgage, or any other bill yet to be paid. In the United States, wealth inequality runs even more pronounced than income inequality” (Wealth). Wealth disparity affects everyone in America. When the top twenty percent of earners in America take over fifty percent of total earnings in any given year, It can be see as very unfair by anyone who is in the middle class and especially the lower class of citizens in the U.S. It is safe to say that both sides of the political world (Republicans and Democrats) are equally worried about how economic inequality will affect their children and future generations. No matter who you ask, rich or poor, and whatever their opinion on the shape of economic distribution in America is, they most likely have a unrealistic sense of the state it is actually in.

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

Wealth inequality in the United States has grown tremendously since 1970. The United States continuously reveals higher rates of inequality as a result of perpetual support for free market capitalism. The high rates of wealth inequality cause the growing financial crisis to persist, lower socio-economic mobility, increase national poverty, and have adverse effects on health and well being.

What is wealth inequality? “It is the difference between individuals or populations in the distribution of assets, wealth or income.” [1] In sociology, the term is social stratification and refers to “a system of structured social inequality” [2] where the inequality might be in power, resources, social standing/class or perceived worth. In the US, where a class system exist, (as opposed to caste or estate system) your place in the class system can be determined by your personal achievements. However, the economic and social class that an individual is born into is a big indicator of the class they will end up in as an adult. [3] What are the effects of this wealth inequality in the US and what causes it as well as some possible solutions

Wealth distribution is not what it should be from our perspective. The distribution of wealth in America has been uneven since 1970. We can see the uneven distribution by comparing one of the wealthiest man in America, Bill Gates, who makes over $50 billion, to a homeless person, who has nothing. This shows an income inequality in the U.S because there is a huge gap between rich and poor. While the unemployment rate has decreased in the U.S, the gap between rich and poor in this country has dramatically increased. There are many contributions to the gap, such as different education levels among citizens and cost of living. The main reason that contributes to the income inequality between rich and poor is technological advances. Technological advance hurt the low-income class greatly but at the same time is a big gain to the higher class. The visual graphics are the most powerful aspect of the video, because many times we hear the statistics and percentages without truly comprehending just

Three studies, published over the last several years, suggest that the majority of American’s have no idea how unequal the wealth gap actually is. The average American believes the richest fifth of the country own 59% of the wealth. The reality is that the richest fifth own about 84% of the nation’s wealth. This same idea also translates into an issue of income equality. CEOs for large corporations get paid about 12 times what the average American worker thinks they get paid. The average CEO-to-worker pay ratio is

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

Looking at history, it is clear to see that a pattern of financial decline has struck nearly every generation, harming the middle class and benefiting the executive class. In the 1930’s, the infamous “Great Depression” swept the world as the worst economic disaster in history, leaving millions unemployed and homeless with no food and several children to feed. Beginning in the

With the topic of income inequality becoming more prominent in the media, it is important to focus on the individuals who are taking the most advantage of this: CEOs of business firms. According to the Norton and Ariely (2011), “the top 1% of Americans hold nearly 50% of the wealth, topping even the levels seen just before the Great Depression in the 1920s.” Unfortunately, this number is only increasing with time as a result increasing the gap of average household income in the United States. To further examine pay deviation, it is important to understand the causes for this divergence. In the United States, the CEO of a company now makes 380 times the average worker’s pay in the company (Norton & Ariely, 2011). Therefore, does it mean that

There is no economy in the state of nature. The economy is a set of rules; based on property, liability, anti-trust, bankruptcy, subsidies and taxes for certain things. Robert Reich has not only demonstrated why the unequal distribution of income isn’t reasonable, but the vigorous strength behind the diminishing American Dream and the battle of our democracy. He shows how a virtuous cycle of higher wages and productivity, which put more money in consumer’s pockets, therefore driving the economy forward and increasing revenues for government investment, was replaced by a vicious cycle in which stagnant incomes undercut consumer purchasing, leading to lower demand and more layoffs along with declining tax revenues and government spending.

“The potential to accumulate wealth is very great among certain segments of professionals.” (Purrucci and Wysong 148) Wealth, like income, attributes to inequality in the United States and the more income an individual makes the more potential they have to have an excess of money, to put away for future endeavors unlike the hourly minimum wage worker. The high up an individual is in the company they are more likely to, “receive substantial salaries and bonuses along with additional opportunities to accumulate wealth.” (147) These individuals are “applying their resources to secure and sustain their place at the top,” (Marger 52) because the inequality of wealth is only growing between the rich and the poor, with the top twenty percent owning eighty-four percent of the entire wealth in the United States. Companies seem to give incentives for their top business professionals to acquire wealth, while the less desired employees are not given those same opportunities.

There are many inequalities prevalent in the US, and as a capitalist society, one of the most common is economic inequality. The Equality Trust defines economic inequality, as the gap between the well off and less well of in regards to overall economic distribution (“How Is”). See, our capitalist society strongly benefits those with a capitalist mentality and can afford the means to invest/own capital. Over the years there has been an increasing wealth gap between the top one percent earners and the general population. So why are the rich flourishing while the poor are struggling in this capitalist environment? The policy decisions of our country allow this inequality to permeate throughout our industries, thus creating a culture of power and greed. One result of this culture is the explosion of high salaries in the US and Emmanuel Saez explains this trend in Striking it Richer. Saez affirms, “Indeed, estimates based purely on wages and salaries show that the share of total wage and salaries earned by the top 1 percent wage income earners has jumped from 5.1 percent in 1970 to 12.0 percent in 2006” (Grusky 89). Too bad that the 99 percent of America missed out on this massive economic growth spurt. When economic growth is not evenly distributed among the general population, people tend to question our entire system. This has been an increasingly controversial issue, where corporate America is responsible for the constant exploitation of low-level employees. Through my

The widening inequality in income has progressively grown to become a defining challenge in the contemporary society. Now more than ever, the gap that exists between the rich and the poor is at its all-time high in decades, particularly in the developed economies. Emerging markets and developing countries (EMDCs) have more mixed inequality trends where some countries have seen drops in levels of inequality, but pervasive inequality trends continue to remain in access to vital sectors like healthcare, education, and finance. The degree of inequality, therefore, does not come as a surprise, nor the driving forces behind it, and the possible solutions to the problem are currently some of the most fiercely debated issues by researchers and policy makers alike.

Laissez-faire economies will naturally diverge. In the absence of external shocks, the middle-class diminishes over time while the wealthy will accumulate capital. In the past century, the American middle-class benefited from the erosion of traditional powers in war-torn Europe and expansionary policies passed during The Great Depression. These shocks allowed the US to grow a strong and prosperous labor force. But as the United States entered the latter half of the 1970s, the growth of real income began to stall and was no longer matching the growth of productivity. Although the productivity/GDP still rose, growth is not a rising tide that lifts all boats. This bifurcation of income and productivity was caused by automation, globalization and exasperated by conservative economic policy. This bifurcation also