URGENT Economic Inequality paper

Is economic inequality a problem? Most sociologists think that it is. And there is little question about the fact that economic inequality is increasing. Do you think some students who enroll in any particular course deserve a higher grade than others. Almost certainly, most will say the answer is “yes.” Why do you think so? My students commonly claim that some students work harder than others; some have more experience with the subject matter than others, and some people may simply be better writers, better test takers, or simply smarter than others. Do similar arguments apply to economic inequality? In general, conservatives say “yes,” with many adding that they favor a society with broad opportunity for people to perform and increase their skills over time. Conservatives tend to see the market system as a more-or- less fair arbiter of what people’s work is worth. Liberals are not so sure the market judges people fairly. For one thing, because people don’t start out in the same place, government programs are needed to level the playing field a little. In addition, markets tend to be dominated by powerful economic interests, which is to say, the rich. Radicals on the left, of course, make a stronger claim that a market system per se is going to generate lots of inequality, almost all of which is viewed as unfair. There are many facts to convey in this module. But, most important, is the opportunity to think and talk together about how we define economic inequality. Throughout our nation’s history, the population at large has accepted economic inequality, but people have done so with a catch—everyone should have some reasonable chance of improving economic standing. As the Tracking the Trends figure at the beginning of your reading by Macionis, there has been a very significant erosion of belief in the claim that the United States is a nation of economic opportunity. Do you think this trend can continue without some major shift in support for our political and economic systems?

� STRATIFACTION AND SOCIAL CLASS IN THE U.S. Sociologists refer to inequality that is built into the structure of society as stratification

• the structured ranking of entire groups of people that perpetuates unequal economic rewards and power in a society ◦ means that your individual opportunity is based on your place

on the social hierarchy • Can take different forms

◦ depending on whether they’re ascribed or achieved ◦ and whether they’re open or closed ◦ examples: slavery or caste systems

▪ ascribed, closed In the U.S., the major form of stratification is class.

• A social ranking based primarily on economic position in which achieved characteristics can influence social mobility ◦ achieved = you have some control over your social class

▪ hard work, education, etc. ◦ social mobility = you can move from one class to another

� U.S. generally thought of as divided into 5 classes:

• upper ◦ wealthiest, most powerful ◦ 1-2%

• upper-middle ◦ business executives, upper-level management, doctors,

lawyers, other high-level professionals ◦ 15%

• middle ◦ less affluent professionals

▪ teachers, nurses, small business owners, clerical workers ◦ typically have a college degree or hope to send kids to college ◦ 30-35%

• working ◦ manual labor jobs

◦ 30-35% • under class (or poor)

◦ limited access to the paid labor force ◦ 15-20%

 INEQUALITY IN THE U.S.  Inequality is inherent in the structure of a class system

• otherwise, there would only be one class But the degree and extent of inequality can differ There are two main measures of inequality: income and wealth

• income = wages and salaries • wealth = all of a person’s material assets minus their debts

◦ savings, land, stocks, other property

� • each kind is generally measured by breaking up the population into

quintiles (different ones from above) ◦ each has an equal number of people

▪ in a population of 100 people ▪ the lowest quintile would have 20 people

▪ the second quintile would have 20 people ▪ and so on

▪ we look at how much income or wealth each quintile has  

�  Survey of Americans:

• do own ◦ average response

▪ 9% for bottom ▪ 59% for top

◦ reality ▪ bottom 40% own 0.3% ▪ top quintile owns 84%

◦ Americans are less aware than those in other countries about the extent of inequality

� Other characteristics of income and wealth inequality:

• mean household income by quintile (2011): ◦ mean: $67,530 ◦ lowest: 11,034 ◦ 2nd: 28,636 ◦ 3rd: 49,309 ◦ 4th: 79,040 ◦ richest: 169,633

• percent share of total income (2010): ◦ lowest: 3.3% ◦ 2nd: 8.5% ◦ 3rd: 14.6% ◦ 4th: 23.4% ◦ 5th: 50.2%

• the top 1% owns more wealth than the bottom 90% combined

• six members of the Walton family, heirs of Wal-Mart founder Sam Walton, own more wealth than the bottom 40% of U.S. families combined

But the important question is: • is this level of inequality too much, too little, or just right? • how did your responses to the ideal situation compare to this reality? • average American’s ideal situation

◦ more equal than any existing society ▪ poorest quintile = 11% of wealth ▪ richest quintile = 33% of wealth

• 92% of Americans preferred “Equalden” to actual American distribution ◦ equalden takes the Swedish model and adjusts it to make it

even more equal  

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