ECONOMIC INEQUALITY Presented by Adam, Andrea, Bill, Jerry, Shane The gap between the rich and the poor in the United States is much too wide. It must be narrowed for every citizen to have the opportunity to achieve the core ideals of our democracy (life, liberty, and the pursuit of happiness). History 1600-1900 1607 Settlers land at Jamestown, Virginia 1619 The start of African people being forced to come to America as slaves 1788 the Constitution is ratified 1796 federal government selling land for $2 per acre 1808 Slave trade banned but not slavery 1830 Indian Removal Act 1861 11 southern states secede, form confederacy and the civil war begins 1863 Emancipation Proclamation 1865 Confederacy collapses war is over 1870 Jim Crow laws late 1800s industrialization begins History – 20th Century 1929 Stock market crashes, start of the Great Depression 1932 FDR elected New Deal 1935 Labor Relations Act- right to form unions 1939-1945 World War II 1950 start of the Civil Rights Movement 1950s Baby Boomers 1980s Reaganomics 1990s technology boom Share of wealth held by the Bottom 99% and Top 1% in the United States, 1922-2007. Wealth Distribution in the United States Total Net Worth Top 1 percent Next 19 percent Bottom 80 percent 1983 33.8% 47.5% 18.7% 1989 37.4% 46.2% 16.5% 1992 37.2% 46.6% 16.2% 1995 38.5% 45.4% 16.1% 1998 38.1% 45.3% 16.6% 2001 33.4% 51.0% 15.6% 2004 34.3% 50.3% 15.3% 2007 34.6% 50.5% 15.0% Wealth Distribution in the United States “In the United States, wealth is highly concentrated in a relatively few hands. As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers).” From http://sociology.ucsc.edu/whorulesamerica/power/we alth.html . Income Distribution in the United States Top 1 percent Next 19 percent Bottom 80 percent 1982 12.8% 39.1% 48.1% 1988 16.6% 38.9% 44.5% 1991 15.7% 40.7% 43.7% 1994 14.4% 40.8% 44.9% 1997 16.6% 39.6% 43.8% 2000 20.0% 38.7% 41.4% 2003 17.0% 40.8% 42.2% 2006 21.3% 40.1% 38.6% Income Distribution in the United States “As of 2007, income inequality in the United States was at an all-time high for the past 95 years, with the top 0.01% -- that's one-hundredth of one percent -- receiving 6% of all U.S. wages, which is double what it was for that tiny slice in 2000; the top 10% received 49.7%, the highest since 1917.” From http://sociology.ucsc.edu/whorulesamerica/power /wealth.html . Future Impact Net Worth Distribution of Net Worth 70% 60% 50% 40% 30% 20% 10% 0% Top 1% Next 19% Bottom 80% 2007 2020 2030 2040 2050 3000 Top 1% go from 34.6% to 37.7% net worth Next 19% go from 50.5% to 62.1% net worth Bottom 80% go from 15% to less than 1% net worth Future Impact (cont.) The prognosis of this issue continuing is that by the year 3000, the top 20% of people will own 99% of the wealth, whereas the bottom 80% will own less than 1%. The gap is widening at its current trend. Wealth equals power; therefore the social impact of this trend is that the bottom 80% will continue to struggle to gain any power as a result. The economic impact of this trend of lowering net worth for the bottom 80% is that there will be a greater need for services such as medical care and housing. Politically, the impact will be extreme. The exacerbation of this issue, as the trend shows, will require major political changes. The country cannot survive long with 80% of the inhabitants owning less than 1% of the nation’s wealth. Class Discussion Turn and talk to a neighbor about Economic Inequality Brainstorm solutions Option 1 Taxing the wealthy and relying on Non-Profits and Foundations is a short term solution Will help to “lop” off the top and raise up the bottom Paternalistic redistribution in terms of the rich & elite and doesn’t allow people to provide for themselves Doesn’t address the lack of access Economic system needs to be restructured Remove the social filters and power structures that block the access of the majority New regulations should be applied to cap excesses Put checks on size of financial institutions Reign in corporate power Provide guidelines on reasonable proportions for income Regulate Shadow banking Give the power of the government back to the people Evaluate your own CONSUMPTION *** get from Adam *** Option 2 End Welfare Establish a dollar-for-dollar tax credit for contributions to private charity Tear down barriers to entrepreneurism and economic growth Reform education What Can Individuals Do Study the issues Question the numbers Research Programs Volunteer Time and/or Money Looks for ways to bring control back to the lowest level needed Risks and Benefits of Individual Actions There aren’t any risks for these individual actions Becoming more informed is a huge benefit Personally volunteering will help organizations that need it and will fulfill a need in you to do more Bringing more money back to the individuals and organizations that are directly helping people will provide more resources to those people Local, State, National, International Actions States need to get more control back from the federal government Reduce the tax burden on all citizens at all government levels Audit existing programs and cut out inefficiencies Reform Education Risks and Benefits of Local, State, National Actions Federal Government will get smaller as States take back more control, thus getting more funding for local services that are more effective Reducing the tax burden will give consumers the ability to decide where their money should go Program that are not efficient will become more efficient or cut so more funds become available Improved schools means improved more knowledgeable public and workforce Thinking Clearly About Economic Inequality Cato Institute Lack of clarity and care have confused the public about the moral significance of income inequality The dispersion of incomes has a tenuous connection to human welfare or social justice The unequal political voice of the poor can be addressed only through policies that actually work to fight poverty and improve education. Income inequality is a dangerous distraction from the real problems: poverty, lack of economic opportunity, and systemic injustice. Delusions of Disparity: Distorting the truth about income inequality by J. A. Foster-Bey Since 1967, households have gotten richer, not poorer. After controlling for inflation, median household income has risen by almost 30 percent from 1967 to 2003. As a result, most median-income and lowerincome households improved their overall income and moved up, not down, in the national income distribution. The proportion of households with incomes under $35,000 declined by almost 23 percent, while the percentage of households making over $50,000 increased by over 77 percent. Indeed, the percentage of families earning over $75,000 rose by 218 percent between 1967 and 2003. Service Learning Projects Analyze/Audit Welfare and Volunteer Program Research and Support State Initiatives Research and Volunteer for Philanthropic Organization Sources Who Rules America: Wealth, Income, and Power http://sociology.ucsc.edu/whorulesamerica/power/wealth.html Outline of the U.S. Economy - http://www.america.gov/publications/books/outline-ofthe-us-economy.html United for a Fair Economy – http://www.faireconomy.org Dēmos – http://www.demos.org The Revolution Will Not Be Funded by Incite! Women of Color Against Violence Libertarian Views on Poverty and Welfare: Ending the Welfare State http://www.lp.org/issues/poverty-and-welfare Thinking clearly about economic inequality http://www.cato.org/pub_display.php?pub_id=10351 Dillusions of Disparity: Distorting the truth about income inequality by J. A. Foster-Bey - http://old.nationalreview.com/comment/fosterbey200409280847.asp Conservative Economics 101 - http://spectator.org/archives/2008/03/27/conservativeeconomics-101 Service Learning Sources K-12 Service-Learning Project Planning Toolkit - http://www.servicelearning.org/filemanager/downloa d/8542_K-12_SL_Toolkit_UPDATED.pdf 101 Ideas for Combining Service & Learning http://www2.fiu.edu/~time4chg/Library/ideas.html Service Learning Ideas and Curriculum Slices http://servicelearning.org/slice Good Character http://www.goodcharacter.com/SERVICE/service.html