Presented by Adam, Andrea, Bill, Jerry, Shane

ECONOMIC INEQUALITY

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 Century1929 Stock market crashes, start of the

Great Depression1932 FDR elected New Deal1935 Labor Relations Act- right to form

unions1939-1945 World War II 1950 start of the Civil Rights Movement1950s Baby Boomers1980s 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).”

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.”

Future Impact

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

2007 2020 2030 2040 2050 30000%

10%20%30%40%50%60%70%

Distribution of Net Worth

Top 1%Next 19%Bottom 80%

Net

Wort

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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 DiscussionTurn and talk to a neighbor about

Economic InequalityBrainstorm solutions

Option 1 – Robin Hood 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

The Mythical “Free Market”

Our “Free Market”

“Managed Capitalism”

Option 2 – Three Little PigsEnd Welfare

a job is better than any welfare program phase out inefficient government welfare

Establish matching tax credit for donations to private charities federal government charity has been a dismal failure private charity efforts are very successful

Tear down barriers to entrepreneurism and economic growth tax and regulatory policies are designed to discourage

economic growth and reduce entrepreneurial opportunities

Reform education, break up the public education monopoly Wealthy parents can send their kids to better schools Poor families send kids to public education systems that

fail to educate

What Can Individuals DoStudy the issues from all sides and research

programsMore Informed Public

Question the numbersDon’t just accept numbers

Volunteer Time and/or MoneyPersonally volunteering will help organizations

that need help and will fulfill a need in youLooks for ways to bring control back to the

lowest level neededMore resource delivered where needed

Local, State, National, International ActionsStates take back control from the federal government

Federal Government will get smaller as States take back more control, thus getting more funding for local services that are more effective

Reduce the tax burden on all citizens Give consumers the ability to decide where their money

should goAudit existing programs and cut out inefficiencies

Program that are not efficient will become more efficient or cut so more funds become available

Reform EducationImproved schools means improved more knowledgeable

public and workforce

SummaryEconomic InequalityGap between rich and poorMany Options and Viewpoints

Option 1 – Robin HoodOption 2 – Three Little Pigs

What will you do?

Service Learning ProjectsAnalyze/Audit Welfare and Volunteer

ProgramResearch and Support State InitiativesResearch 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-of-the-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/conservative-economics-101

Service Learning SourcesK-12 Service-Learning Project Planning Toolkit -

http://www.servicelearning.org/filemanager/download/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

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 lower-income 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.

Thinking Clearly About Economic Inequality - Cato InstituteLack of clarity and care have confused the public

about the moral significance of income inequalityThe dispersion of incomes has a tenuous

connection to human welfare or social justiceThe 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.