For several decades, we’ve heard about growing income inequality. I believe that is a poor description of the problem. It’s more about income disparity. Since there are differences in education, capabilities and cost of living, incomes cannot and should not ever be equal. As a nation, the US may occasionally struggle with recessions and unemployment which can be mitigated by government policies. But no one – NO ONE – who works a full-time job should be paid less than a living wage!
The current situation is unreasonable and unsustainable. And it is almost entirely the result of political decisions made to benefit corporations and the very wealthy – the people who really control our government through lobbying and campaign donations.
As productivity has continued to rise; as more highly-paid workers have been replaced by robots; as more workers toil in minimum wage jobs, corporate CEOs have seen their compensation dramatically rise. So, too, have stock traders on Wall Street. Indeed, the people at the top of every company have never done better. Never mind that they are profiting on the suffering of their employees and the largess of taxpayers. For example, Walmart is notorious for paying many of its employees minimum wage. To help compensate those employees, Walmart helps them apply for government welfare programs paid for by taxpayers. At the same time, Walmart accepts corporate welfare in the form of government infrastructure assistance and tax relief, again paid for by taxpayers.
It is because of this system that the owners of Walmart – the Waltons – have become one of the world’s richest families.
Another reason for the increasing disparity is the decades-long attack on labor unions and collective bargaining. Republican-led legislatures have routinely voted to make their states “right to work” states (i.e. non-union states). And they have passed laws making it increasingly difficult for workers to organize. As a result, they have effectively ended collective bargaining in those states. Wages for ordinary working people have stagnated. Benefits such as health insurance and dental plans have been weakened or eliminated altogether at the same time health care costs have exploded. A recent study found that the cost of family health insurance now exceeds $20,000. Those who are unable to afford quality health insurance are one medical emergency away from bankruptcy as documented in 2017 when there were more than 767,000 bankruptcies due to illness and medical bills.
The US is the only nation in the developed world where this happens!
Additionally, many US corporations and employers have reduced or eliminated retirement and savings plans for their employees. Consequently, the median savings for an American family in 2016 was just $7,000. And many households have no savings at all. Far too many Americans are forced to work multiple jobs to survive. Even then they often struggle from paycheck to paycheck.
Is it any wonder that the number of homeless in the US has grown?
Those in professional jobs are not immune to the growing disparity. Teachers with advanced degrees make so little money in some states that their families actually qualify for food assistance. Yet they’re still expected to pay back the student loans they accumulated while obtaining the required degrees – loans that can run into the hundreds of thousands of dollars.
It’s true that American workers will never realize financial equality with business managers and owners. But they shouldn’t have to watch those people buy mansions, vacation homes and yachts while they struggle to put food on their tables.