Why We Should Care about Wealth Inequality?

Phase I: Introduction

Where Did Wealth Inequality Originate?

Introduction: Genesis

In recent years, America’s wealth gap has been growing, especially during economic downturns and inflation periods. Many experts have pointed out that almost after every single economic recession, the gap refers to the distribution of wealth within each class of society. This article explores how this uneven wealth distribution affects the living standards of Americans, offering an easy-to-understand look at an issue that affects everyone.

The Historical Setting:

Wealth in the United States has always been unevenly distributed, but this gap has become much bigger over the last few decades. Especially after big economic problems, like the 2008 financial crisis, a few people held most of the wealth. This change is more than just numbers – it significantly affects the daily life of the average American.

There are numerous sources indicate that this the reason economic recession leads to the death of many medium to small businesses. Which consequently leads to a huge loss of jobs especially for blue collars working class. The 2008 economic crisis is a prime example where the poverty rate within America spikes rapidly, causing a huge loss of assets within the middle and lower income class.

Phase II: The Impact

How Wealth Inequality Affects You!

Present Condition of Wealth Inequality

Today, the richest 1% of Americans have much of the country’s wealth. A report from the Federal Reserve shows they own about 30% of all wealth, while the poorest half of the population only has 2%. This gap shows that for many people, achieving success and finding opportunities is becoming harder, given the fact that the gap of wealth keeps on increasing day by day. The graph on the right indicates the wealth distribution increasing progressively throughout the year.

Effects on the Quality of Life:

This wealth difference has big effects. People in the middle and lower classes often struggle to get good healthcare and education. Dreams like owning a home or moving up in life are getting harder to achieve, as many are stuck with debt and no economic growth. This gap also leads to more stress and growing tension between different economic groups.

It is also proven that, poverty and crime are closely correlated, as those with lower income and less education opportunities are more likely to commit crimes. This is due to the limited opportunities and resources available in low-income neighborhoods. Substandard living conditions, insufficient funding for education, and a lack of financial resources contribute to a struggle for living. In many poor areas, family structures tend to be unstable, and parents with low incomes have less time to devote to their children’s academic and social development.

“Recessions generate income inequality.”

– Claimed New Republic

Increase in Inflation Rate

Unlike many other economist believing in an eternal economic growth, N.Gregory Mankiw claims in his book of “Principle of Macroeconomic” that Recessions generate income inequality. In addition, he also confirms that with a high inflation rate leads to the currency losing its value, making daily items more expensive. Items being unaffordable would eventually have a very huge impact on people from both middle and lower class.

Phase III: Different Perspective

How is this issue being viewed from different perspective?

Varieties in Perspectives:

Diverse sociological and economic explanations are offered for this trend. Certain factors contribute to this, including technological advancements and global economic changes that favor high-skilled labor. Conversely, policy choices that have diminished social safety nets for the impoverished while decreasing tax burdens on the affluent are cited by some. In the interim, firsthand testimonies from people spanning various socioeconomic backgrounds provide a compelling depiction of the practical implications of these trends.

To conclude,

Often time, the issue of wealth inequality is greatly overlooked by the mainstream media. However, it is irrefutable to acknowledge that almost every current discriminations known ranging from racism, sexism, homophobic or xenophobic all root from classism and wealth inequality.

Beyond being an economic issue, the widening wealth gap in the United States poses a threat to the fundamental values of opportunity and justice. The article emphasizes that the ramifications of inequitable wealth distribution extend to all facets of American society, encompassing education, healthcare accessibility, and the fundamental structure of our social order. It is not merely an issue of economic policy that must be addressed; rather, it is a society-building concern. It is imperative that we, as citizens, policymakers, and readers, engage with these issues, comprehend their complexities, and advocate for substantial transformation.