Economic Inequality in The United States

The United States undoubtedly maintains an extremely high standard of living. Those considered “poor” in the US still earn a considerably higher amount than most people in the world. It is almost easy to disregard the idea of economic inequality when a majority of US citizens have food to eat and a bed to sleep in. Nonetheless, the United States boasts the second-highest level of income inequality in the world.

US politicians love talking about “leveling the playing field” and creating a free and fair economy when in actuality favoritism is a driving force in the US economy. Politicians hand pick winners and losers by means of bailout’s, subsidiaries, tax breaks, and government policies. Ultimately, a company is nothing without a proper lobbyist.

The rich get richer and the poor get poorer, or so they say. Forty years ago, middle class income not only rose in accordance to economic growth, it also rose at a higher percentage than that of the rich. Currently, a majority of US citizens are seeing little to nothing of the economic health we are currently experiencing. According to the National Bureau of Economic Research, income earned by the bottom 50 fell from 20 percent in the 80’s to 12.5 percent in 2014. Meanwhile, income rose by 121 percent for the top 10, 205 percent for the top 1, and 636 percent for the top 0.001 percent. The economic bounty is evidently going straight to the top.

The effects of economic inequality are only perpetuated by the United States government’s inability to properly allocate government spending. Americans give up about 30 percent of their income to federal, state, and local government taxes. Nonetheless, government redistribution has done little to offset pretax inequality. Government redistribution has gone largely to the elderly and the middle class. Individuals in the bottom 50 earn an average of 25,000 in after-tax income, only slightly above the 20,000 someone in the bottom 50 earned in the 1970’s. Ultimately, the US tax system is failing at what it was designed to do, help the poor.

The current state of economic inequality is troubling enough; nonetheless, the situation is likely to worsen. One explanation for the drastic rise in inequality relates that the rise in globalization and technology has allowed a small portion of skilled individuals to capitalize on the shift, disproportionately effecting economic income and wealth.

Ultimately, it seems as if the American dream no longer exists. The US economy is a rigged system in which wealth and poverty is circumstantial. Those born poor are likely to stay so, just as those born rich will likely stay rich.