The Broken Contract : Inequality And American Decline

In American society, wealth has played a particularly significant role in shaping the culture and standards set for our country. With every dilemma that has occurred, money was been an underlying deciding factor in the end. John.F.Kennedy makes this very clear in his statement on lowering the prices of steel, all the way Jennifer Price's take on people being obsessed with a money, even Scott Russell’s article on the status quo Americans believe determines one's happiness and success. All of these passages tie together to show just how money influences our very own society.

A Critical Analysis of The Divide: American Injustice in the Age of the Wealth Gap

The land of freedom, the United States, is the Promised Land for all. Its citizen can be much as prosperous as they want. Nonetheless, a phenomenon has occurred gradually that has changed the economy, social levels, income, and wealth of all Americans. This is called inequality. Inequality has become a social problem since people has not raised their voice take advantage of voting, large corporations as CEOs who take instead of give.

Americans today live in a distinctly unequal society. Inequality is now wider than it used to be in the last century, and the division in income, wages, and wealth are broader than they are in other developed economies of the world. Wealth inequality is the imbalance of wealth or income within a society, and it is one of the most vital economic challenge the US is facing today because the distribution of wealth is more dispersed, making the inequality in wealth distribution at its highest. While the matter has been discussed for many years, the actual income disparity in the U.S. has heightened and is now verging on an extreme gap that portends to impede long-term economic growth. The huge gap between the wealthy and poor is squeezing the U.S. economy, the wealth gap threatens economic growth by diminishing social mobility and producing a less-educated workforce who are not able to compete in the global economy. unrestrained level of income inequality causes political pressures, it discourages trade, investment, and hiring. The present level of income inequality in the U.S. is shrinking GDP growth, and the world's largest economy is struggling to recover from the Great Recession.

Social inequality stems from many facets of life and mindsets reproduced continuously in America. The main backbone of systematic inequality is formed off of race, gender and class, which all contain crucial aspects that further oppress those subjected to inequality in various aspects of life. The resources-schools, occupations, invested parents- around one fuels the opportunity in their lives, a concept highlighted by Malcom Gladwell, in his book, Outliers. Situations one are brought up in or uncontrollable genetic aspects can very easily restrain their opportunities. Racial discrimination, gender roles and inferiority and the lack of fluidity in the low and working class push inequality, which simultaneously influencing the rich and privileged.

Today in America, income and wealth inequality has continued to grow at an unsettling pace. The rich continue to get richer, while the number of people categorized as lower class grows exponentially. As Joseph Stiglitz has explained, many theories that are seen as strongly Republican, such as the trickle-down effect, has caused the rich to take money from the poor, and as a result the lower class grows and the middle class disintegrates. The top 1 percent of America’s households currently holds 30 percent of America’s economy, which is much more than other first-world countries and helps to emphasize the extremity of inequality currently in America today. This increased inequality has in turn caused America to become a much more divided society; those born in poverty typically stay in poverty, with little to no chance of self-improvement due to a lack of education provided in their areas. In contrast, those that are born wealthy typically go to better schools, have better health care, and are all but spoon fed information on how to remain wealthy. These two sides of society almost never cross, and this causes the country to be more divided than ever. In order to limit this inequality, drastic changes must be made, such as large corporations paying their fair share of taxes and giving back to the lower class, and minimum wage should be raised. If everyone in America works together, we can raise social mobility and re-unite what has become an increasingly divided country.

Furthermore, the equality of opportunities as one of the foundations of the American dream turned into evident inequality. “The lion’s share of economic growth in American over the past thirty years has gone to a small, wealthy minority, to such an extent that it’s unclear whether the typical family has benefited at all from technological progress and the rising productivity it brings” (Krugman 586). Income inequality has been steadily growing since 2008 when the global financial crisis erupted. Moreover, the gap in prosperity between the group of Americans with high income and all the others had never been such extreme as it is now. Thus, not everyone has the opportunity to become wealthy through hard work. The increase in socioeconomic inequalities,

“The United States is a nation where people are supposed to be able to rise above their origins. Those who want to succeed, it is believed, can do so through hard work and solid effort.” (Andersen, pg 1) If this was only true we would live in a world in which we would all prosper based on how hard we work. The truth of the matter is that income inequality and institutional classism were simply built into the sheer fabric of this nation. Income inequality has affected many in the United States. For many the American Dream is simply that a dream.

From the 1880s-1920s America went through a period of industrialization that shaped the world we live in. As America’s economy was forming, so was each social class. The wealthy elite had the ability to capitalize on new technology and the middle class had a more stable life with prosperous jobs; however, in contrast, the unskilled poorest workers primarily factory workers, worked and lived in the most abhorrent conditions with barely enough money for a small meal. The wealthy elite—primarily the people that had money, and made more money in this era— possessed the ability to capitalize on newfound technology and other small capital gains which led to their monumental success. For example John D. Rockefeller who was an up and coming grain dealer, went into the kerosene business and his firm—standard oil of Ohio—was Cleveland’s leading refinery.

Wealth inequality is already shaping American politics and society, and has the dangerous potential to be the defining problem of the upcoming generation. A sizable cause for wealth inequality in America is a dire lack of

Jill Lepore's essay puts a spotlight on the growing issue at hand and provides heartfelt examples of the dangers that inequality has caused America; she provides facts that show the growing dilemma that inequality is causing U.S. citizens. In this essay, there will be an analysis of some of the facts and evidence Jill Lepore has provided of this growing issue within America.

The overarching theme of this book is that political elite continue to get rich while the middle class gets poor. Hacker manages, somehow, to remain relatively unbiassed about our government issues despite being a progressive reformer. Hacker and Pierson theory is that inequality is, largely a political issue and can only be corrected by the American voters. The problem, of course, is that voters are to much divided to create a political change that is need improve America’s political issues. Political politicians severely favor big business interests and the wealthy elite to reform the political system, which attest to the old slogan of lifting oneself up by one's own bootstraps. The problems of political inequality, are real but the more we as American voters understand the political issues, the better America’s middleclass has for overcoming them, and this book provides a great deal of insight on the current obstacles to creating a progressive change in our current political

The Princeton academic Larry M. Bartels provides an interesting challenge to conventional wisdom, providing a political explanation for an economic problem greatly effecting the entirety of the United States. In his book, Unequal Democracy, Bartels unveils the strong relationship between politics and economics, identifying political policies to be a key element in the inequality issue among Americans. The non-partisan political scientist emphasizes the notable differences that Republican and Democratic policies have on middle and low income families in America. Bartels establishes that Democratic policies have improved economic growth and reduced income inequality between the classes while Republican policies have produced economic contractions

Wealth in relation to the upper class is defined not as income, but “the value of everything a person or family owns, minus any debts” (Domhoff 2005). Income according to Domhoff, “is what people earn from work, but also from dividends, interest, and any rents or royalties that are paid to them on properties they own” (Domhoff 2011). Those who own a great deal of wealth do not derive it from income, although they may have a high income resulting from the returns on their wealth. (Domhoff 2011) As for the power the upper class wields on politics, the economy and the government, it is indirectly carried out “through the activities of a wide variety of organizations and institutions. These organizations and institutions are financed and directed by those members of the upper class who have the interest and ability to involve themselves in protecting and enhancing the privileged social position of their class” (Domhoff 2005). This description of the upper class by Domhoff provides the basis for the argument that it institutionally exist - an organized, cohesive group set apart by its wealth and power.

The era of volatility has created a shift from America being the middle-class society to simply rich or poor (Sachs, 2011). A gap this large has not been experienced since the 1920’s (Sachs). “The top 1% of households takes almost a quarter of all household income” but an economy this top heavy will not be able to succeed (Sachs, 2011, p. 30). The working classes are struggling with housing, wage, and employment issues. Rich individuals are ignoring these troubles, shipping their business operations out of the country, thus furthering the downward spiral of the economy (Sachs). To make matters worse, this has become in a large part a political issue, because the rich can influence candidates with funding, where the poor and working