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Social and Economic Inequality in America

Rishabh Mishra

February 1st, 2011

According to an article from BusinessInsider, the top 0.01% of the richest families in America

had 892 times more income than the bottom 90% of Americans in the year 1928, one year before the

Great Depression. In 2006, two years before the Great Recession, the top 0.01% of the richest

American families had 976 times more income than the bottom 90%. The 21st century in United States

has seen a divide between the rich and the poor unprecedented in both history and the current statuses

of other heavily industrialized liberal democracies. While most economists agree that social inequality

—on a certain scale—is a catalyst of capitalism, it is undoubtedly clear that the gap between rich and

poor Americans has grown too large.

Professors Richard Wilkinson and Kate Pickett of The Equality Trust, in their book The Spirit

Level: Why More Equal Societies Almost Always Do Better, argue that the equality of a society is more

important to its health than the society's total productivity. This concept is heavily backed up with data.

For example, Portugal outranks the United States on the UNICEF Child Well-Being Index, despite the

Portugal having only half of the US's GDP per capita. Portugal, as well as the rest of Western Europe,

also holds a much lower incarceration rate than the United States. In fact, the US incarceration rate is

so high that it is five times that of the UK—which is the highest in Western Europe. In The Spirit

Level, Wilkinson and Pickett draw a direct connection between social inequality and high incarceration

rates, mental illness rates, high school dropout rates, teen pregnancy rates, obesity rates, and more

social ills. The two professors measured all those statistics for the wealthy liberal democracies that are

members of the Organization for Economic Cooperation and Development (OECD), and the United

States very frequently came out as having the most of those social ills because of its high social

inequality despite its status as a military-industrial superpower.


But the social maladies of the United States, caused by this socioeconomic inequality building

up over the decades, can be fixed. What needs to change is how the government deals with the poor.

At the forefront of this effort would be education reform. According to a presentation from Harvard

sociology professor Bruce Western, men that did not pass high school are three to four times more

likely to go to jail than men that graduated high school. This statistic can be read in a positive way, as

it suggests that making efforts to significantly lower the dropout rate will then reduce the prison

population, which will then offer some pain relief to American society. Expanding the educational

reform to include making obtaining post-secondary education much easier will give the people at the

bottom the necessary tools to climb the social ladder. Giving workers the education they need to

compete in a global marketplace will help them boost their wages. Strengthening of unions, which

have seen a decline in recent years, will help employees negotiate better working arrangements with

their employers. Furthermore, prison reform will help those at the bottom of the bottom, keeping them

out of an unending cycle of imprisonment and helping them be productive members of society. Bruce

Western suggested reforms such as the reduction of the heavy reliance on incarceration for drug

offenses, the reduction on the reliance of long and punitive sentences—particularly for repeat

offenders, and the reduction of parole revocation rates. If carefully calibrated, these policies can lift up

the impoverished of America and cure our social ills.

And this curing of our society is something that we need. In 2007, according to that same

BusinessInsider article mentioned in the first paragraph, the bottom 50% of the American population

held only 2.7% of the nation's wealth. America cannot go forth like this, coughing and wheezing

because of socioeconomic sickness. Some of the reforms needed may a tough pill to swallow, but if the

disease is not cured, then it is only going to get worse.