Analysis: Economic Inequality In America

Economic Inequality in America The Occupy movement gained fame in September 2011 with a slogan that brought together a wide range of people, “We are the 99 percent.” The goal of the group is to get rid of economic inequality throughout the world. The group sparked a change in the way many people look at the way the world is. Wealth inequality is a word used to describe how money and assets are distributed among a group of people, in this specific case, the group of people is the population of people living in the United States. Everyone knows there is economic inequality in America, but the degree of inequality is highly contested. Why inequality is occurring is another topic people can’t seem to agree on, is everyone given an equal chance
or are some at an advantage over others based on their connections. Many people believe America was and is a land of opportunity, many people have immigrated to the United States to start a new life in a country that regardless of who you are, where you came from, and who you know, you have a chance to make something of yourself. Many people now believe that the United States is not the land of opportunity it once was, The Occupy movement began protesting how wealth is distributed in the United States. Using slogans like “Of the 1 percent, by the 1 percent, For the 1 percent.” The movement caught many peoples’ attention. The group claimed that the wealthiest 1 percent of Americans held too much of the wealth of the entire countries population. The top 1 percent of earners make an average of $717,000 a year (Dunn) while the average of all americans is $51,000. The average net value, or total worth of all assets of the top 1 percent is 8.4 million dollars or 70 times the worth of lower classes. The top 1 percent control 43 percent of the wealth in America and the next 4 perent control an additional 29 percent, so the top 5% of Americans own 72 percent of the wealth of all Americans. The occupy activists think its wrong that so much is controlled by so few, while people on the right believe that it’s fair as long as everyone has an equal chance to make it to that top 5 percent. Income inequality is being caused by a large amount wealth being held by a very small portion of people, while a large portion of people only control a small amount of wealth.
Many of the top earners are born into a rich family who are in the top 1 percent and the child has an advantage over children who are not in the top 1 percent. The child who has money is more likely to go to college, and usually a better college than a child with less money. The child who is in the top 1 percent is also more likely to have connections to people who can help them earn money, and stay in the top in adulthood.
Conservatives see the disparity as an incentive to work hard to make it to the top if you’re in one of the bottom groups of earners. Occupy movement activist call for a redistribution of wealth, so there is equality. Conservative groups see redistribution as taking away from people who have worked hard for what they have and giving it to people who have not tried as hard to make money. Some conservatives will go as far to say that income inequality doesn’t exist, but because of the way income is shown on tax forms it appears the earnings are larger than they really
are.(“Arguments”) Many people also believe that many in the top 1 percent have gotten their money through inheritance from a wealth relative this does happen in some cases, but a study showed that only 14.7% of the wealth of the top 1 percent has been through wealth transfers, which also includes gifts. ( Matthews) In 1992 the same wealth transfer equaled 27 percent of all of the wealth of the top 1 percent of earners, showing that more money is being earned by the group than was being handed down, or given as a gift. Many people say that the disparity of wealth is hurting the economy.
Branko Milanovic, a World Bank economist, has said “Widespread education has become the secret to growth. And broadly accessible education is difficult to achieve unless a society has a relatively even income distribution.” According to a December 2010 paper by economists Michael Kumhof and Romain Rancière of the IMF. In the 1920’s when there was a boom in the economy, low wage workers were encouraged to use credit to make up for wages that didn’t keep up with inflations, which than caused large defaults when the economy crashed. And the same thing happened in the 2008 recession. But others say that inequality is a sign of growth, and good for the economy because it causes the hardest working to make it to the top. And they spend more, thus pumping more into the
economy. In capitalism, the incentive is to work hard, and succeed because of your hard work. But now many people are thinking that no matter how hard they work they can’t get ahead unless you know someone, related to someone or are lucky. While others think you can, but you just aren’t working hard enough. Inequality in America is a topic that people disagree on whether is exists in a bad form, or is a good thing to help the economy.

Works Cited
"Arguments (and Counterarguments) Against Fixing Income Inequality." Untitled Document.
N.p., n.d. Web. 01 Dec. 2013.
Dunn, Alan. "Average America vs the One Percent." Forbes. Forbes Magazine, 21 Mar. 2012.
Web. 30 Nov. 2013.
Matthews, Dylan. "Research Desk: Did the Top 1 Percent Inherit Its
Wealth?" Washington Post. The Washington Post, 04 Nov. 2011. Web. 19 Nov. 2013.