Economic inequality is something that has loomed over our country for centuries. What was interesting about the article that I found on “The Street.” What caught my attention was that it was titled “Income Inequality? Americans Don’t see it”. Basically what the article begins to unfold that 52% disagreed that American has a problem with economic inequality. I was shocked by this statistic. To me it seems clear that there is an economic divide between that haves and have not’s. Especially because this divide has become larger and larger over the last 20 to 30 years.
What we might ask is how Economic inequality is a social problem when 52% of the society feels that it is not an issue. First we must establish what economic inequality is, it is defined as “comprising all disparities in the distribution of economic assets and income. The term typically refers to inequality among individuals and groups within a society” (Social problems). Hence economic inequality is a social problem mainly because it affects a large majority of the population. Seeing that the “richest 20% of Americans earn 10 times the amount of the poorest 30%. Now one might see that the richest 20% would probably disagree with the fact that economic inequality is a social issue seeing they are not negatively affected by these inequalities, which is true in one aspect but if we begin to look at the social cost we can see it affects all citizens including the rich.
As we begin to evaluate the cost of this social problem it becomes a little frightening that 52% of America do not recognize these costs. Steve Pressman a professor of economics states that “inequalities hurt the economy but decreasing productivity as well as reducing efficiency” (Bernasek). Thus we see with the decline of productivity we see a drop economic growth consequently producing recession. Recession then promotes more inequality seeing that we see an increase in unemployment and an increase in governmental assistance. We also see as a result of economic inequality an increase in crime. Crime increases due to the fact that people are frustrated with the inequality amount the society and it is an attempt to fight the inequality.
While we understand the wide ray of cost of economic inequalities the causes of this social problem are a little more complex. Common dreams establishes three fundamental reasons for the economic inequality spur from “capitalism, government, and pay” (Gutman). This becomes more clear if evaluate the fact that in order to have capitalism you must have capital thus capitalism has a built in tendency to reward those who work hard for what they have. The government plays a large role in economic inequality seeing that they tax (take money away from one group) and redistribute that money (to other groups). Pay also becomes an underlying cause of economic inequality due to the earnings of workers. Business Week sates “the CEOs of large corporations earn, in salary and other compensation, five hundred times what their average workers make” (Gutman). While we can probably assume that the worker is working much harder and longer hours than the CEO.
What may be confusing is if the American people generally agree with the causes of Economic Inequality. As we have seen in the news clip about Americans not seeing economic inequality we may assume that if 52% of Americans don’t think there is an economic gap, but for those that do know about the economic inequality the causes seem clear, seeing that our economic system is based on capitalism. We can also see that society understands that governments are partly to blame due to the reaction to fair taxation of the upper class. Pay on the other hand may not hold as much precedence in the cause of economic inequality seeing that most people do not know how muck the wealthy make and this is for a reason. Although what is understood is the economic inequality is a social problem that become worse and worse over the years.
Works Cited
Bernasek, Anna. "Income Inequality, and Its Cost - New York Times." The New York Times - Breaking News, World News & Multimedia. 25 June 2006. Web. 04 Oct. 2011. <http://www.nytimes.com/2006/06/25/business/yourmoney/25view.html>.
Brownell, Matt. "Income Inequality? Americans Don't See It - TheStreet." Stock Market Today - Financial News, Quotes and Analysis - TheStreet. The Street, 04 Oct. 2011. Web. 04 Oct. 2011. <http://www.thestreet.com/story/11266530/1/income-inequality-americans-dont-see-it.html?cm_ven=GOOGLEN>.
Gutman, Huck. "Economic Inequality in US." Home | Common Dreams. 1 July 2002. Web. 04 Oct. 2011. <http://www.commondreams.org/views02/0701-05.htm>.
"Social Problem." Google. Web. 04 Oct. 2011. <http://www.google.com/#sclient=psy-ab>.
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