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Income inequality in the U.S.

Michael Scinto
Student Writer

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Photo from Quinn Dombrowski http://tiny.cc/kk6aby

 

On Tuesday, March 22, the Messiah College Democrats held an event on income inequality, the first in a series hosted by the club focused on important issues in contemporary American politics. In Jordan Atrium, a diverse range of students gathered to hear about and discuss topics such as economic mobility, class and society in America and Canada. Headlining the event was John Harles- professor of politics- who presented research from his upcoming book tentatively titled Choose Your Parents Wisely.

Income inequality is a hot topic in today’s political conversation—from Bernie Sanders railing about the “billionaire class” to Occupy Wall Street chanting, “we are the 99 percent”—but what are the actual numbers? The reality is quite worrying: America is by far the most unequal Western democracy, with its inequity rivaling the numbers of both China and Russia. According to the GINI coefficient, an index that measures income distribution and assigns countries a numerical value (1 – 100) based on the equality of said distribution, the United States has a score of 41.1; for reference, Uganda is at 42.4, Russia at 41.6, and Germany 30.1.

The grim news does not end there: the Organization for Economic Cooperation and Development (OECD) revealed that, among developed nations, America has the largest disparity in income distribution—beating out Spain, Italy and even Greece. This means that a small percentage of top earners account for a greater share of total income than the vast number of bottom earners.

At first blush, such a revelation may seem intuitive (as a critic might say, “Of course the rich have more money than the poor, it’s basic economics!”), but the statistic hides an insidious reality. The wealth of the highest earners is rising dramatically while that of the lowest is stagnating or shrinking. In 1933, the top one percent of earners accounted for a little over 10 percent of the United States’ income. In 2016, that number is over 21 percent—as high as it was on the eve of the Great Depression.

Some might be tempted to dismiss problems of inequality—the beauty of the American dream, after all, is that it allows even the poorest person to rise to riches. But the facts say otherwise: class mobility is just as much a casualty of inequality as the middle class.

Among OECD nations, America has some of the highest rates of income elasticity. Children in America are far more likely to have their economic fortunes affected by their parents than their peers in, say, Denmark or Finland. How rich, or poor, a person’s parents are, almost inexorably ties them to a specific social class. In a perfectly equal society, such a problem would not merit attention; however, it is precisely the inequality in America that makes the problem of (non-existent) class mobility so important.

When asked about why he is writing Choose Your Parents Wisely, Harles said, “I want to answer the question ‘why care?’” Why should people care about rising income inequality when, by all accounts, the general quality of life is better than it has ever been?

Though the book is a comparative analysis of how Canada and America approach their socioeconomics woes, it goes beyond a simple overview of pressing global problems: it is a call to action. Life may seem good, but there is an ever-increasing disparity between the haves and have-nots; if this trend continues, then the quality of living enjoyed by many Americans may be in peril.

Beyond that, democracy as a whole is in danger— can a society truly be free when money equals power, and that money is concentrated in the hands of a small percentage of the population? Dealing with social inequality is one of the foremost challenges of the 21st century, and will most likely be a pivotal battle for upcoming generations.

This past decade has seen a dramatic increase in public awareness and interest in social issues — especially among millennials. Movements like Occupy Wall Street and Black Lives Matter have galvanized thousands of young adults into action while the radical populist rhetoric of Bernie Sanders seems to have struck a chord among the disenfranchised youths of America. Now more than ever, it is important for people of all ages to stay informed about income inequality and contemplate ways to fight it.

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One comment

  1. John Telesh (Class of '91)

    In response to the income inequality article:
    I found the content of the article interesting and would like to make two observations.
    First, we would receive more of our income if well-intentioned voters would stop voting for people who insist that government programs (and their subsequent taxes to fund them) can help us. It’s easy to spend someone else’s money. No matter what politicians promise us, It is all of these cumulative programs on the local, state, and federal levels that deplete our incomes. We are viewed as “revenue” no matter what salary we make. If you are a resident of a high tax state, the negative impact is clear to see. I believe that empowering the individual by lowering the tax burden allows people to give more of their income. When Christ spoke about giving to the needy, he wasn’t speaking to the Roman leaders about how to govern their country; he was speaking to individuals about their personal relationships.
    Secondly, some people mistakenly believe that God wants equality. Biblically speaking, God doesn’t work that way. Christ’s parable of the talents brought home the point that it’s not how much you have, but it’s what you do with your talents that matter. Also, the Spirit doesn’t give gifts to men equally, but only as He determines (1 Cor 12:11). Christ doesn’t give grace to all men equally, but only as He apportions it (Eph 4:7&11). Even in spiritual matters, God doesn’t believe we need to be equal. There is always going to be someone with a better car than you, someone with better grades than you, someone with a higher paying job than you, and someone with smarter kids than yours. That’s why the contentment of the Apostle Paul in Phil 4 is so rich with truth.
    Is the topic an interesting one? Yes. Can people agree to disagree? Yes. Will it ever be solved? Not in this world. When it’s solved, it won’t matter anymore.

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