Problems of Power and Control :Economic Inequality

Lauren KovacsContemporary Social Issues - GNED2057-15F-12669

Professor Emily BrettFriday, November 27, 2015. (Balance Scale Image, 2015)

(World Map, 2006)

What is economic inequality?“Economic inequality is the difference in how assets, wealth, or income are distributed among individuals and/or populations. It is also described as the gap between rich and poor, income inequality, wealth disparity, wealth and income differences, or the wealth gap” (Inequality, 2015).

(Expensive Ignorance and Economic Inequality, 2014)

What is the significance of economic inequality? Economic Inequality is significant because the planet we live

on is so dependant on money. Throughout the world economic inequality is massively seen through the division between the rich and the poor. This causes many relevant problems worldwide that will be later mentioned. From a sociological perspective economic inequality separates society as a result of power and control issues. If not for this inequality, many of the worlds struggles would not exist.

(Tomislav, 2014)

How is income inequality measured?

The most common technique used to measure economic inequality is referred to as the Gini

Coefficient.

According to the Conference Board of Canada, the Gini Coefficient, “calculates the extent to which the distribution of income among individuals within a country deviates from an exactly equal distribution” (Income Inequality, 2015). In simpler terms, the Gini coefficient uses a ranking system that demonstrates a countries wealth distribution in regards to equality. For instance, if a country is rated 0 then they have complete equality, whereas if a country is ranked 1 then a single individual owns all the countries wealth. Based on this image Greenland is high on income equality, and countries south in Africa are very high on income inequality.

The Gini Coefficient:0 = total equality (same

income)1 = total inequality (one

person has all)

(World map Gini coefficient with legend, 2006)

Economic Inequality and the WorldThe following are statistics that support the prevalence of economic inequality:

• “The richest 1% of adults in the world own 40% of the global household wealth; the richest 2% of adults own more than half of the global: and the richest 10% of adults owns 85% of total global wealth.

• The poorest half of the world population owns barely 1% of global wealth.

• Households with per adult assets of $2200 are in the top half of the worlds wealth distribution; assets of $61,000 per adult places a household in the top 10%, and assets of more than $500,000 per adult places a household in the richest one percent of the world population.

• Although North America has only 6% of the worlds adult population, it accounts for 34% of all household wealth worldwide.

• 1.4 billion of the worlds population is leaving in extreme poverty” (Holmes, Mooney, Knox, & Schacht, 2016).

Economic inequality is a massive issue worldwide. As demonstrated through these statistics, the worlds wealth is unevenly distributed. The rich represents little population but majority of wealth. Whereas the poor makes up a large part of the worlds population receiving little to nothing.

(World’s Wealth, 2015)

This video takes a numeral approach to looking at the worlds wealth distribution in simpler terms. The video looks at the world on a macro level and exposes the fact that the richest 1% has 43% of the

worlds wealth. It is mentioned that 80% of the worlds people have barely any of it’s wealth. It is stated that the richest 300 people on the planet have equal wealth to 3,000,000,000 of the poorest people.

Ultimately this causes a massive social issue of inequality and eliminates the possibilities of education, medicines and other basic human needs (TheRulesOrg, 2013).

).

Economic Inequality in Canada

Economic inequality in Canada has been on the rise over the past 20 years. The above image (left) demonstrates the downfall of inequality in the 80’s.

There was a sudden peek in 1991, and the inequality has been building even since. The image on the right illustrates the wealth distribution in Canada. It

makes it clear that the two wealthiest groupings own 62.3% of Canada’s total income, whereas the poorest people own 7.3% (Income Inequality, 2015).

The above video takes a progressive approach to spreading awareness of economic inequality in Canada. The video discusses how the majority of Canadian’s work more and earn less now then they did 30 years ago. It is addressed that Canada’s current economic gap is the result of poor political choices

that causes more violence, less health, and less prosperity. As a result, people have lost faith in the system and therefore are losing the sense of community. Finally, the video offers solutions to such problems, which believes Canada can be different and offer fair wages, fair taxes, and good jobs

(Broadbent Institute, 2012).

Relation to other inequality issues:

Economic inequality opens up a gateway to many of the worlds current issues. For instance it is related to the idea of gender inequality by the fact that men make more then women, which in some cases

contributes to the stereotypes around women. Another factor is that due to the uneven distribution of wealth many people find themselves living in poverty, and some homeless which causes lack of

healthcare, education, and increased crime rates. This is a vicious cycle because once an individual lacks access to the things that will help them rise above in life, then they are not making the money to live a sustainable lifestyle. Another big issue is the idea of class conflict, prejudice, discrimination, and

struggle over resources because all of this opens the doors to warfare. Finally, economic inequality also relates to mental health issues because people are stuck in that cycle of inequality and are not getting

access to the support of resources that will better their lives in some cases.

• Gender inequality• Relation to crime• Access to education• Access to healthcare• Opens the doors to prejudice and

discrimination• Causes class conflict and instability

worldwide • Wars over resources• Causes poverty and homelessness • Struggle over land and housing • Majorly contributes to mental health

issues

(Key Issues in Poverty & Inequality, 2011)(Inequality, 2015)

Economic Inequality in Relation to the Conflict Theory:The Conflict Theory is defined by the textbook as, “the theoretical framework that understands material inequalities to be a driving force behind many social problems” (Holmes, Mooney, Knox, &

Schacht, 2016).The conflict theory relates to the issue of economic inequality because the theory views this social issue in regards to the economy being structured to benefit the wealthy. This theory believes that the proletariat (workers) have domination over the bourgeoisie (owners). According to the conflict theory, laws and policies are set in place to benefit the wealthy. This is known as welfare, which the textbook describes as, “government policies and regulations that economically favour the wealthy”(Holmes, Mooney, Knox, & Schacht, 2016). Ultimately the conflict theory approaches economic inequality as a result of the rich having power and control over the poor.

(Rich man’s blood poor man’s war, 2013)

Solutions…Though economic inequality is a massive as well as complex social issue, there are always ways to improve. Some possible and relevant solutions to such problems include:

• Create more jobs• Provide employment for all• Improve taxes for low income families • Free education for all• Free healthcare for all• Equal wages• Job security• Remove race barriers• End discrimination • Create more work initiative programs

– educating young people• Provide unemployment insurance• Raise minimum rage

All of the proposed solutions would play a role in providing economic equality for all. Things like fair

wages could be accomplished by providing everyone with free education and to demolish

racial/gender discrimination so that everyone has fair opportunities. Another solution is to create more jobs worldwide and raise minimum wage.

Creating more work initiative programs would be beneficial because it would educate young people

on the importance of creating a stable financial lifestyle. In addition, providing job security and

unemployment insurance would create economic safety for all. Finally, one of the biggest solutions

to the gap between the rich and poor is the idea of lowing taxes for low income families. This , as well as all of the above would force the world economy

to give everybody a fair chance and therefore, ultimately, provide equality for all.

(10 Solutions to Fight Economic Inequality, 2015)

In conclusion…Economic inequality is a major issue not only in Canada, but throughout the

world. Income inequality is defined as the gaps between the rich and the poor. There are three categories that fall under economic inequality which include, income inequality, pay inequality, and wealth inequality. Economic

inequality is measured by the Gini Coefficient. Economic inequality contributes towards the worlds struggles such as, poverty, homelessness, lack

of education, lack of healthcare, warfare, battle of resources, gender inequality, and overall prejudice/discrimination. All of the above are current

issues in the world as well as in Canada. Economic inequality is a major power and control issue that needs a solution, WE NEED CHANGE!

(Living with Inequality, 2015)

ReferencesBalance Scale Image. (2015). Retrieved from http://www.clipartbest.com/balance-scale-image

Broadbent Institute. (2012). Ed Broadbent on Income Inequality. Retrieved from https://www.youtube.com/watch?v=ZDWOm9eGVpU

Expensive Ignorance and Economic Inequality. (2014). Retrieved from http://quietmike.org/2014/06/28/expensive-ignorance-economic-inequality/

Holmes, M., Mooney, L., Knox, D., & Schacht, C. (2016). Understanding social problems. (Fifth Ed.). Nelson Education: Toronto.

Inequality. (2015). OECD data. Retrieved from https://data.oecd.org/inequality/income-inequality.htm

Inequality. (2015). Retrieved from http://www.forbes.com/sites/jamesmarshallcrotty/2015/02/27/knowledge-is-power/

Income Inequality. (2015). The conference board of Canada. Retrieved from http://www.conferenceboard.ca/hcp/details/society/income-inequality.aspx

Key Issues in Poverty & Inequality. (2011). The Stanford centre. Retrieved from http://web.stanford.edu/group/scspi/issue_home.html

Living with Inequality. (2015). Retrieved from http://www.economist.com/news/united-states/21660180-what-good-more-unequal-america-might-look-living-inequality

Rich man’s blood poor man’s war. (2013). Retrieved from http://clipart-finder.com/clipart/RichmansWARPoormansBLOOD4.html

The Equality Trust. (2015). The equality trust’s focus on economic inequality. Retrieved from https://www.equalitytrust.org.uk/how-economic-inequality-defined

References (continued)Tomislav, I. (2014). Income inequality. Retrieved from

http://www.vancouversun.com/business/Opinion+Income+inequality+problem+Canada/10657684/story.html?__lsa=3078-8fcc

TheRulesOrg. (2013). Global wealth inequality - what you never knew you never knew. Retrieved from https://www.youtube.com/watch?v=uWSxzjyMNpU

World Map. (2006). Retrieved from https://commons.wikimedia.org/wiki/File:World_map_clip_art.svg

World map Gini coefficient with legend. (2006). Retrieved from https://commons.wikimedia.org/wiki/File:World_Map_Gini_coefficient_with_legend_2.png

World’s Wealth. (2015). Retrieved from http://www.qcc.cuny.edu/SocialSciences/ppecorino/INTRO_TEXT/Chapter%2010%20Political%20Philosophy/Inequality.htm

10 Solutions to Fight Economic Inequality. (2015). Talk poverty. Retrieved from http://talkpoverty.org/2015/06/10/solutions-economic-inequality/