A Growing Wealth Gap
Published: Monday, February 6, 2012
Updated: Tuesday, February 7, 2012 00:02
Rising income inequality threatens to destroy the promise of America — that each citizen has a chance at material and personal success, independent of the condition of his or her birth. Upward social mobility and equality of opportunity are nothing short of America's civic religion, but these tenants are in danger of becoming little more than vestiges of the nation's storied past.
We should be concerned about rising levels of income inequality because of the corresponding decrease in social mobility. While the potential demise of the American dream may not concern the wealthiest among us, increasing income inequality causes other social ills that impact both the rich and the poor. According to the Congressional Budget Office, average members of the top one percent of wage earners saw their incomes increase from $337,000 a year in 1979 to $1.2 million in 2006. During that same time, average members of the middle 60 percent of wage earners saw their incomes increase by less than 50 percent. The richest one percent of Americans saw their incomes grow approximately seven times more quickly than did members of the middle and working classes.
The bottom line is, it now takes more for Americans to pull themselves up by their own bootstraps and improve their economic standings.
In January, a widely circulated article in The New York Times ("Harder for Americans to Rise from Lower Rungs," Jan. 4, 2012) pointed to at least five recent studies that suggest decreasing levels of social mobility in the United States. One study found that 42 percent of Americans born into the lowest quintile of income earners stay there as adults. Even British wage-earners, in a notoriously stratified society, fared better, with 30 percent of those born into the bottom quintile remaining that poor throughout their lives.
In discussions about the impact of income inequality, the promise of equal opportunity is the most frequent retort from those who dismiss equality concerns as the fanciful concoction of liberals and leftists. The evidence, compiled by sources varying from the Pew Charitable Trusts to the Brookings Institute to a group of Swedish economists, points to the contrary: The United States is not the socially mobile country that most believe it to be. The sad fact is that if you are born poor in America, you are over five times more likely to live and die in the lowest 20 percent of income earners than you are to enter the top 20 percent.
Income inequality is not just a concern for underprivileged Americans, however. In their book "The Spirit Level," sociologist Richard Wilkinson and public health expert Kate Pickett examine the relationship between income inequality and a variety of social ills.
Comparing wealthy capitalist states, they find a strong correlation between mental health problems and unequal societies in wealthy capitalist countries. The United States, for example, is the 39th most unequal country according to the CIA-recognized Gini-Index and has an extremely high incidence of mental health cases. For instance, in 2010, one in five adults was diagnosed with depression. That's 20 percent.
Likewise, violence, incarceration, drug use, childhood obesity and low math and literacy scores are much more common in nations with high levels of income inequality.
Vastly unequal societies experience higher incidences of social ills because many of these problems are caused by low levels of social trust. Wilkinson and Pickett show how social trust deteriorates across the income spectrum as national inequality rises. The United States must be particularly alarmed.
Wilkinson and Pickett conclude that "more equal societies almost always do better." As an article from The Economist writes, this "is a sweeping claim, yet the evidence, … painstakingly marshaled, is hard to dispute" ("Social Inequality: Always With Us?" Feb. 26, 2009).
Mitt Romney, now the leading GOP candidate, happens to be in the top .006 percent of income earners. He recently remarked that discussions of income inequality should only occur in "quiet rooms."
I could not disagree more strongly. Rising income inequality over the last three decades has led to decreasing levels of social mobility and social trust, harming the United States. The time for a serious public discussion about income inequality is now.
Americans learn from a young age that this nation is great because individuals have the chance to excel, independent of the circumstances of their births. Today, we must ensure that the American dream endures for the next generation by reversing the trend of growing income inequality.
BRIAN SHAUD is a senior in the College and a former member of The Hoya's editorial board.