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The Risk of Wealth and Income Gaps
The American Income and Wealth Gap
The issues and events represented in the broadening public discussions about “wealth and income disparities” or the “wealth divide” or the “1% and the 99%” are certainly top-of-mind for many people as we created this Hot Topic in October 2011. These are certainly not new issues, but for many Americans the Great Recession is intensifying some of the troubling aspects of income inequality and certainly the obvious wealth inequality in the USA today.
The essence of the American Dream has been about the assurance of equal access to quality education, the enjoyment of a good income (“living wages”), access to affordable healthcare, and the means to acquire a home of one’s own.
These have been the traditional pathways to building personal and family wealth at least since years of the Great Depression. In the “Era of Prosperity,” after World War II, the American middle class emerged in great numbers. Thanks to equal access to credit and capital, steadily increasing wage levels for workers, and reasonably-priced housing and durable goods, attaining higher levels of education, among other things, each generation could expect to be better off than the previous. Until now. What most Americans believed to be “financial fairness” for a rising middle class has been fading away since the financial sector crisis of 2008-2009, if not in reality, than in the perceptions of many people.
In contrast, the 1947 to 1975 years, as author Robert Reich points out in his book, “Aftershock,” was an era when the benefits of economic growth were more broadly shared. But since 1975, the economic gains have been steadily concentrated in the upper income and wealth regions of the US economy, and the middle-class and lower income earners have been missing out on the dividends paid by (among other things) the end of the Cold War and the onset of globalization that followed.
Unemployment is stuck at the 9% level; and, many Americans are under-employed, working two jobs, or out of work for so long that they have given up on finding a job. Which leads to more financial stress on millions of families.
As the former Secretary of Labor writes, “None of us can thrive in a nation divided between small number of people receiving an ever larger share of the nation’s income and wealth and everyone else receiving a declining share…” We agree.
Real opportunity and access – and not that portrayed today by certain pandering politicos – has been slipping away for millions of Americans. The Capitol Hill rhetoric does not square with the facts on the ground -- the statistics and facts and consumer surveys paint a different picture, first in the facts, and more recently, in the perceptions held by many Americans.
Not About Wealth Re-Distribution
This reality of diminishing economic returns is not about income or wealth re-distribution, or pursuing socialist or left-leaning political ideologies or policies, or schemes to tax the rich. This is about both the reality and perception of financial fairness and equity, and equal access to economic opportunity, which many middle-class and low-to-moderate income earners now believe is no longer the American Dream for them. This is a potentially dangerous social condition and one that our policymakers – or the fortunate affluent and wealthy -- should not ignore.
As this introduction is prepared, the Occupy Wall Street protests are in their third month, with hundreds of other cities and communities seeing demonstrations on their main streets. The protests so far have been peaceful and civil if not raucous at times.
The movement has spread to other countries. Earlier in 2011, citizen protests were staged in the Middle East – in the Arab Spring, young and old protested against repressive government policies and the lack of economic opportunity for the masses in Tunisia, Libya, Egypt, Bahrain, and Syria. A major part of the complaints: lack of jobs, and lack of or unequal opportunity in terms of income and wealth-building, as well as the desire for more democratic rule.
There is now abundant news & commentary about the income and wealth divide in the United States, as well as a growing gap between rich and poor in many other countries. We are bringing you the highlights of this issue in this Hot Topic, because we believe that everyone should be tuned in to this critical social issue, which threatens the well-being of the nation, and individuals in all socio-economic categories. The solutions are not easy, or simple, or something government can prescribe. All Americans have to address the issues – and some of us will have to give a little to get back on track.
We cannot afford to lose the Millennial Generation (born 1975-2000) – the young people who seek the opportunities that their parents and grandparents enjoyed.
The editors have been focused on the issues surrounding the income and wealth divide for some time – this Hot Topic is being added to Accountability Central as the issues continue to gain momentum. We will be offering commentary in a running series, “The Divide – Danger Ahead.”
We welcome your comments – send to: firstname.lastname@example.org
Introduction: November 2011
Latest on The Risk of Wealth and Income Gaps
January 19, 2018 Investors Can’t Ignore Rising Wealth InequalitySource: Barron's
It’s rare that a week goes by without some statistical reminder of wealth and income inequality in the U.S
January 16, 2018 Citi to boost pay for women and minorities, closing gaps in the U.S., UK, and GermanySource: USA Today
Citigroup will boost job compensation for women and minorities in a bid to close pay gaps in the U.S., United Kingdom, and Germany, becoming the first U.S. bank to respond to shareholder pressure about the inequalities.
January 11, 2018 Finding relief from the rising tide of income inequalitySource: The Hill
The news cycle at the end of last week highlighted the persistent “rising tide” of inequality cast over the U.S. economy. The Financial Times posted charts from a Deutsche Bank report documenting the growth of income and wealth...
January 9, 2018 How Inequality Is Killing Off HumanitySource: Common Dreams
That's not hyperbole. There is ample evidence for a growing inability of people around the world to maintain the basic human needs of physical health and mental stability and a living wage and a desire to live in peace.
January 4, 2018 Fast-food wars heat up as McDonald's, Taco Bell and others roll out low-priced itemsSource: LA Times
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January 2, 2018 Minimum wage hikes in 18 states set for new yearSource: The Hill
The lowest wage workers in 18 states will get a boost in their paychecks starting on New Year's Day, as minimum wage hikes take effect.
December 27, 2017 World’s wealthiest gain $1 trillion in 2017 on market exuberanceSource: LiveMint
New York/Princeton: The richest people on earth became $1 trillion richer in 2017, more than four times last year’s gain, as stock markets shrugged off economic, social and political divisions to reach record highs.
December 8, 2017 The richest 1 percent now owns more of the country’s wealth than at any time in the past 50 yearsSource: Washington Post
The wealthiest 1 percent of American households own 40 percent of the country's wealth, according to a new paper by economist Edward N. Wolff. That share is higher than it has been at any point since at least 1962, according to...
December 6, 2017 America’s growing wage gap analyzed at Penn State Wilkes-BarreSource: Dallas Post
America’s wage gap continues to widen, making it harder for families to obtain the American Dream, according to Chuck Collins, an economic inequality expert with the Institute for Policy Studies.
December 5, 2017 Time May be on the Koch Brothers' SideSource: Larry Checco, featured commentator
For decades the Koch brothers have employed their enormous wealth to fiercely and relentlessly promote their extreme version of libertarian ideology—meaning, as little government as possible and every citizen pretty much fending...
The Risk of Wealth and Income Gaps
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