Income Inequality - It really can't get any worse - Gaias Homes

Income Inequality – It really can’t get any worse

 In Government, Society and Culture

Tell me where you were born and I’ll tell you your future. This is the harsh reality facing the vast majority of the world’s population, particularly in developing countries where the concentration of wealth and the resulting inequality is striking!

Let’s take for example Bangladesh (8th most populous country on earth), with a population half that of the United States but a GDP (Gross Domestic Product) that is 140 times smaller and that Inequality is only getting worse. This is not the only problem however, even scarier is the growing disparity of income within countries themselves. Brazil is perhaps a model example of such disparity; being home to some of the poorest as well as the richest people in the world. It’s no secret either, the segregation between the rich and the poor can be seen by briefly taking a look at any country’s education system, political system and even architecture. However shocking the differences between nations may be, take a tour of any one of them and there will be one common denominator: Inequality.

Although it may be true that some inequality between the rich and poor can be beneficial to the economy, too much of a gap is having grave repercussions. For some children it may prove to be beneficial but it nevertheless has led to a future where the fate of one’s parents ultimately determine’s one’s future. Even more frightening than this intergenerational inequality is the correlation between the parents’ incomes and where they live. There is both good and bad news in regards to this fact. The good news is that in the passed few years there has not been a huge change in this disparity of income. However, the bad news is that the only reason for this stability is that we, as citizens of earth, can’t really get any worse, in fact we have actually hit a ceiling. The effects of these almost unreal disproportions are graphic enough to scare anyone; social exclusion, political instability and the shear injustice of it all is leaving a body count that includes almost everyone on the planet and if not significantly reduced will lead to much worse consequences.

Social exclusion is one of the most evident effects of the unequal distribution of wealth as its repercussions can be found in every aspect of society. The existence of social inequality can be almost entirely attributed to the the lack of a prosperous economy in certain regions or groups of people. This absence of a prosperous economy makes them incapable of attaining the same, or same quality, of goods and services as the wealthy.

In regions that are completely isolated from the rest of the population. One of the major aspects of society that is deteriorating as a result of social exclusion is the education system. “An essential part of children’s and young people’s lives is spent in the school environment, and the importance of disadvantaged children’s academic performance for their future well-being and employment prospects is considerable. A recent study of children in the United kingdom revealed that those who came from families receiving governmental aid differed greatly from the rest of the population. According to the study, the less fortunate children gave less of an importance to school than others, rebelled more, were bullied more often, had higher dropout rates and had much lower expectations for their future. A number of factors are to blame for the afore mentioned results; first off, children, willing or not, usually follow in the footsteps of their parents. Furthermore,parental involvement in scholastics is feeble at best in most cases whether it is due to lack of time or care the effects remain the same: children don’t have enough guidance or motivation to make an effort in their academics. Education is but one of the many aspects of society under heavy fire yet it renders societies incapable of any income mobility whatsoever.

Even more restrictive to income mobility in society is the reality of intergenerational inequality: fortune but most often misfortune of income passed down from generation to generation. The scary thing about this term is that it is the case for most families around the world and creates a vicious circle whereby no one can get out of the horrors of poverty and the rich can only get richer. “Imagine global income as a flagpole on which income levels are marked from the bottom, around the subsistence minimum, to the maximum household per capita income in the world. Imagine then each country’s distribution to be given a plaque, running along the pole, and covering the range of that country’s income distribution…When a person is born, he gets pinned down to a place on his country’s plaque that not only gives his position in national income distribution but also locates him in global income distribution. He can hope that his country will do well: The country’s plaque will then move up along the global pole, carrying as it were the entire population with it. Or-a last possibility-he might try to “jump ship”, that is, move from a lower plaque (poorer country) to a higher one (richer country).” 

As sad is it may be this is the only way to really avoid the negative effects of intergenerational inequality as it can’t ever really end. The most one can ever really hope for is to move to a country where even just being poor by the standards of that nation will yield better opportunities for the individual and his family in the future. The tradition of inheritance has also proved to be detrimental to the socioeconomic status of the lower class by making the rich even richer with no effect on the poor therefore further increasing this crucial gap. It has also aided in the fostering of a new super-rich class which, in spite of their small size, contribute to a substantial mount of a country’s wealth, giving them an incredible amount of social and political power.

By far the scariest scenario is the threat this inequality poses to meaningful democracy and good governance. In light of our progression towards a society of intergenerational inequality, money really means power.

As children go their separate ways, the poor to a “poor life” and the wealthy to a “rich” one. Indeed, those born into wealthy families inevitably have far greater chances of having an influence on political decisions.Increase in inequality enhance the ability of the wealthy to donate in political campaigns thus leading to politicians increased likelihood to cater to their desires.

 

“The data suggest not only that the rich contribute disproportionately more than the poor, but also that inequality has a positive impact on contributions amassed by the relatively anti-redistribution (Republican) party [party against the equal distribution of income], and a negative impact on those gathered by the relatively pro-redistribution (Democratic) party.”

 

Whether it be millions of dollar being funneled into campaigns or lobby groups (groups organized in the hope that they are able to influence political decisions), with money comes big advantages in the world of politics. Lobby groups in particular, have a definitive impact on politics. Although this impact at times may be for the better, with their abundance of resources, seemingly never-ending funds and legal backing there are no limits to what they can do. Furthermore, plenty of money leads to less of a concern in regards to the proper functioning of public services due to the implementation of penchant policies that adhere to the wealthy.

Interregional inequality is a cause for major concern as well when speaking of the impact of unequal distribution on political stability. “In 1991, the gap, measured by GDP per capita between the richest republic (Russia) [in the soviet union] and the poorest (Tajikistan) was about 6 to 1.” Consequently, such a large gap between region within the nation lead to its eventual dissolution in the December of that year. How can a nation possibly make truly democratic decisions when none of its constituent states are at equal levels of development? This is the problem facing China today with a “top-to-bottom ratio” of 10 to 1 (significantly higher than that of the Soviet Union) and rising the odds of political turmoil are increasing with each passing day.

The coastal regions of China are actually quite prosperous, with GDP’s in some rivaling those of most nations around the world, farther inland however the situation is quite the opposite containing very few people living above the poverty line. This causes 2 major problems in the nation; firstly, no legislations can be passed without singling out certain regions of the country since no territories could possibly hold the same desires or interests when their constituent inhabitants are living different worlds. Secondly, it gives a false indication of the country’s socio-economic status as a whole which makes it hard to raise awareness and tackle the issue consequently dooming china to the same fate as the 

On the sole basis of justice and fairness everyone should be entitled to freedom, safety and the basic necessities of life. However since currency was invented in 700 B.C., this has not been the case. Today in the modern world “the income of the top 1.75 percent of the world’s population matches the income of the poorest 77 percent…”. There’s something scary about the fact that the majority of the world’s population  doesn’t actually know where their next meal will come from while a select few are out island shopping. Currently, the global “middle class” (consisting of 850 million people) is poor. Not only are they poor but they are nearing the bottom of the spectrum with an average income well-below the poverty line. This means that the vast majority of the global population that share a similar income are in fact living under extremely poor circumstances. By closing the gap we are not just helping the less fortunate either, but ourselves as well since the effects of poverty (a synonym for the unequal distribution of wealth) affect the world as a whole. Just to a name one of but a few examples of this, “poverty and bad sanitary conditions within Mexico led to the flu epidemic that quickly spread to the four corners of the world, infected thousands, and killed several hundred people.”. All around the world people are dying of disease, violence and malnutrition yet nothing is being done to bring an end to it. The erroneous “better them than us” mentality is not just wrong in the sense that it is unjust (which it is), but for the simple fact that issues within countries should be examined on a global level as they have global repercussions. 

It is clear that the unequal distribution of wealth within, as well as between, countries around the world not only has a significant impact on many aspects of society but also makes where you live the most reliable predictor of your income. The effects of unequal distribution are felt by everybody and are synonymous with social inequality and political instability which both lead to serious problems for society as a whole. In extreme cases, issues such as interregional inequality have historically been cause for major concern to a nation’s survival. The only way to keep history from repeating itself, as it is showing signs of presently, is to find a way to redistribute this wealth evenly across the nation so that way policies can cater to the greater good of the majority of the people. Inequality between nations is also pregnant with danger for the future. No child should be born with no real hopes and dreams for their future but this is proving to be the case. There will always be exceptions but countless countries leave children with very little option as to what their futures will look like, giving no way out and creating a vicious cycle of poverty. It is imperative that people begin to examine the causes and effects of these problems on a global scale before history repeats itself once more and their repercussions make them global issues. In conclusion, as long as the unequal distribution of wealth remains to be a problem, the stark divide between the rich and poor will result in nothing but affliction for all of us.

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