The Growing Gulf Between the Rich and the Rest of Us
The growing gulf between the rich and the rest of us is a reality that Fortune 500 editors are watching with awe. It has rarely been this stark. Corporate profits rose by 81 percent in 2010, and Exxon reported a $30 billion profit. As the wealth gap widens, it's not just about money. It's also about education, income, and consumerism.
Education Wealth Gap
The educational wealth gap has been increasing over the last few decades. As of 2016, the average household with a bachelor's degree had $79,000 in median wealth, compared to $66,000 in 2019. Among families with a high school diploma, the difference was even more pronounced - a family with an on-time high school diploma had an average wealth of $84,000, more than double the median wealth of those with a GED. While it may seem like the rich have no responsibility for the growing inequality, politicians are starting to acknowledge that something is wrong with our economic system. In 2004, presidential candidate John Edwards ran on a theme of "two Americas" that highlighted the chasm between the rich and poor. And in Virginia, Senator James Webb ran on a theme of economic insecurity to win his seat in the Senate. While President Bush hasn't emphasized the issue much during his administration, he did mention it last week in a speech on Wall Street, saying that "better education" is the way to reduce the chasm between the rich and the rest of us.
Income Inequality
As the gulf between the rich and the rest of us continues to grow, we need to make sure that we take steps to narrow the gap. Inequality is socially unjust and can have adverse consequences for a society. It has also impacted the quality of education and health care for millions of Americans. It also impacts the political system, influencing the actions of politicians and civic engagement. The growing gulf between the rich and the rest of us is a sign that wealth is increasing among the wealthy, and this trend has been growing for decades. Since the 1970s, a growing number of households have reached the top income tier compared to the bottom 80 percent. The gulf between the rich and poor has reached its highest level since World War II. Yet there is no clear solution to the growing gap between the rich and the rest of us.
Consumption Gap
The consumption gap between the rich and the rest of us is an important issue, and it has a dramatic effect on the economy. In the US, the gap has increased since the 1970s, when the gap between rich and poor first appeared. At the time, high inflation rates were eroded the buying power of ordinary Americans and pushed the US into a period of weak growth and high prices. Though this trend has slowed in recent years, it has shown no signs of abating. Since 1979, the wealth gap has increased for the top ten percent of the population, while it has decreased for the bottom ninety percent of the population. This is not only a social issue. The inequality is also impacting the quality of life for ordinary Americans. As a result, average life expectancy is declining and the income of the typical male worker has remained flat. But Americans seem not to understand the magnitude of this inequality. According to a recent Gallup poll, 52% of Americans said the gap between the rich and the rest of the population needed to be closed.
Trends in Distribution of Wealth
The gap between the upper and lower incomes in the United States has grown wide in recent decades. From 2001 to 2016, the wealth of the top 1 percent of American households rose by more than eighty percent, while the median net worth of lower-income households dropped by nearly forty percent. As a result, upper-income households held an average of 7.4 times more wealth than middle and lower-income families. These figures have increased from 3.4 to eight times since 1983. The global inequality trend has a long and complicated history. At the beginning of the twentieth century, inequality was high across the world, with increasing concentration in some countries. Over the next 80 years, however, the trend of inequality decreased almost everywhere, primarily due to a decrease in capital incomes in the top quartile. Nevertheless, current trends are more pronounced in some countries than others. The top quartile in the wealth distribution grew by 4.8% since 2013. The bottom quartile, by contrast, shrank by 1.7%.
