Economic Inequality Assignment

Tiffany Behnam

Economic Inequality Assignment

Does economic inequality exist in America?

Yes, economic inequality does exist in America. A study has been shown from the EPI in which shows the ratio of the average incomes between the rich and the poor from 1980 and 2006. Results were found that the top 1% of rich people earned ten times more than the rest of the working men. Also, at the end of the period in 2006 they earned 20 times as much as they did before. Further more, the Economist further explained that for the highest .1% earners, the gain rose from 20x earnings to almost 80x more. This shows a lot of economic inequality because it gives no opportunity for the poor to get richer and instead, they stay constant with their earnings. Were trying to have an economy with equal opportunity and economic prosperity.

What are the consequences of economic inequality?

Some of the consequences of economic inequality are less job creations. Paul Ryan stated in his youtube video regarding " raising taxes" that " According to the Treasury Department, 80% of all American businesses file taxes as individuals - not corporations. This means that raising taxes on personal income will directly hurt businesses."  More or so, basically the rich get richer and the poor stay poor. Regarding taxes within economic inequality, tax rates go up with however much income you make but the overall tax structures are getting flatter and flatter every second. Another consequence of economic inequality is the social and political repercussions of this inconsistency in the economy rise. Lastly, economic inequality can bring forward corruption to our taxes. This type or "corruption" can hurt the growth of our economy by reducing the efficient allocation of public and private resources and distorting investments everywhere.

http://www.youtube.com/watch?v=gpxIr-lkQec

http://www.nytimes.com/2006/06/25/business/yourmoney/25view.html

3) How can economic inequality be addressed?

Personally, I think economic inequality can be addressed by putting higher taxes on the rich and less on the poor. This way, people who don't gain as much money can catch up and be at some sort of equilibrium with the richer. More food stamps for the poor and less government funding for the rich and their organizations can also address it. There needs to be more balance in how the government controls their money for the rich and the poor. If the poor continue to get less food stamps, they have much less opportunity of gaining any money or any job opportunities because they are stuck footless and homeless as well. One example on how we can address economic inequality is by lowering tax rates on a company that has a large number of workers. This way, the company and the employees can save a lot of money. Also lowers the tax rate for a big corporate company won’t tax the people who receive lower income taxed as much as anyone else would. Lastly, I also think that minimum wage could be raised. This could benefit to economic inequality because even if the minimum wage rate gets pushed a little higher, every penny counts and this benefits a lot to the poor getting richer.

Cites (4, Cleveland)-Paul Ryan