Income Inequality Hurting U.S. Economy
It should come as no shock to any reader that the rich are getting richer in America while the rest of us struggle to remain afloat. In the past decade more income has been consolidated by the top 1 percent and top 10 percent of Americans than at any point in history. There was a point, just a few decades ago, when corporate executives lived comfortable lives adequately compensated for a job well-done. Today executives live lavishly, earning orders of magnitude more than both their employees and their corporate predecessors, and are often rewarded for poor performance – one need only look at the golden parachutes on Wall Street for a prime example.
Any observant person can see the accumulation of money at the top, but a graphic created by The Washington Post shows just how shockingly uneven the redistribution of wealth has been. From 1970 to 2008 the bottom 90 percent of workers saw their real income drop by 1 percent. The highest earners saw growth ranging from 40 to 400 percent.
So-called “conservatives” have attacked President Barack Obama for years for his perceived desire to “redistribute” income to the lower class. The attacks hide their own aspirations for redistribution, which would leave the wealthy and powerful with a larger and larger piece of the economic pie. In 1975 the top 0.1 percent earned 2.5 percent of the nation’s income. By 2008 that number grew to 10.4 percent.
The problem of wealth accumulating at the top is not just that it leads to a larger gap between the rich and the poor. If the rich got richer and then paid some of their wealth forward to all those who were not so lucky the United States might find itself in a better and more stable situation today.
However, according to Salon.com, the exact opposite is true. Rather than making more and paying more, the super wealthy are paying less. America’s super rich use the country’s infrastructure, markets, consumer base, education system, and lack of government regulation to become wealthy and successful. After reaching the top they fight to make sure they have to give back as little as possible to the society in which they live.
The majority of Americans in any poll – not including the Heritage Foundation – agree that the income disparity is unfair. A similar majority also agree that a proper solution is the pursuit of higher taxes on the wealthy. The popular consent is there, but the political will is non-existent. Republican Presidential candidate Tim Pawlenty is actually campaigning on a platform of super cuts for the super rich. According to The Huffington Post, the former governor would dwarf the Bush era tax cuts if elected to the highest office in 2012.
How can an elected official simply ignore the will of his constituents and still hold onto a hope of being elected? It starts with the fact that American voters are easily manipulated. In the end most voters break on single issues – abortion, civil rights, etc. – and the candidates know it. Pawlenty can ignore those in his base who want more regulation or more taxes because he has already won their vote on social/moral issues that have no effect whatsoever on the economy. President Obama can do the same.
Elections are won and lost by manipulating a portion of the electorate to vote for a candidate who seems to embody a favorable moral or social model – his or her stances on the actual issues that affect jobs and the economy are irrelevant. Stable economies do not have huge disparities between the rich and poor. Japan has no such rich-poor divide, nor does France or Germany. Even booming China has managed to keep the gap between the wealthy and the impoverished in check – and it is a one party elite-led autocracy with hundreds of millions of workers on the lower end of the spectrum.
If the United States hopes to recover it has to invest in itself and in its future once again. The only people who are being asked to pay for this recovery are the lower and middle class. The only people who can actually afford the cost are the upper class. Until the American people realize this fact, and act accordingly in general elections, there will be no relief.