Rags to Riches, you can achieve anything, the American Dream has always posited that hard work and perseverance can get you anywhere. But recent research demonstrates that inequality has wiped out this long cherished belief. Many countries are more mobile than the United States. Trickle Down and Victim Blaming are largely responsible.

The way to attack the argument of inequality isn’t to say that it’s a bad thing that the wealthy have so much. But that decades of production, hard work and long hours by most of America’s working class has lead to so little increase in wages. It isn’t the issue that the wealthy are successful. It is that the rest of us are becoming less able to become successful.

Health and Longer Life go hand in hand with income and wealth. – Plutocracy in America, pg 103. 

In this view, it isn’t a matter of earning more money. It is a matter of being able to afford more life.

Saez found that the real incomes of the top one percent of families grew by 86.1 percent over the period 1993– 2012, while the incomes of the bottom 99 percent (which by definition includes families that are doing very well) increased by only 6.6 percent. This means that the top one percent harvested 68 percent of the entirety of real income growth over this more extended period. Any increase in middle class consumption over the couple of decades is largely the story of families relying increasingly on the incomes of secondary (predominantly female) wage earners and of spending funded by borrowing against the rising bubble of home prices.

For this reason, arguments focusing on the consumption patterns of the middle class over time tend to be highly misleading. For a decade or more leading up to the Great Recession, consumption was financed through borrowing against assets that in retrospect did not exist. In the end, consumption is the aim of earning income, but at the household level it is income that finances consumption, not the other way around.

So we see what income growth comes as a result of more women having to work, not people making more, and that almost all growth since 1992 and 1980 as well has gone only to the top. You can blame whoever you want but growth is only going to one place, the top. This is what we are talking about when we are saying that inequality needs to be part of the public discourse. We don’t care that the rich get richer, that’s fine. We are talking about the fact that the growing economy is not bringing everyone along with it. This isn’t a matter of personal blame – well you just need to work harder. This is a Macroeconomic, structural problem that is systemic to the entire economy. More members of the family are working when they may have preferred to work at home raising children but cannot. Family income may have thus gone up, but median worker income has virtually not. Inequality is a subject about addressing the stagnant middle class wages, not hate upon the wealthy. Just “workin’ harder” doesn’t make you richer if you have systemic structural macroeconomic failures endemic to the entire economy.  

Republican Argument: The Poor should just stop complaining! Even the poorest in the US live better than the rich in most countries! If you make $20,000 a year here, you are in the top 1% of the World! So be grateful and stop complaining about inequality! 

If anything, to be poor in a rich country, where one’s worth is sadly too often presumed to be linked to one’s possessions (unlike in a poor country, where people still know better) is to foster a particularly debilitating kind of relative deprivation. To be poor in a place where success is synonymous with being rich and famous increasingly means finding oneself voiceless, ignorable, criminalized and perceived as disposable. To live in a place where wealth is not only visible but flaunted, where the rich make no pretense to normalcy, and where one can regularly hear oneself being berated on the airwaves as losers and vermin and parasites precisely because you are poor or working at a minimum-wage job, is to be the victim of a cruelty that the citizenry of poor nations do not as likely experience. In a nation where poverty is distressingly normal for the vast majority, the poor are still likely to be viewed as belonging equally to a common humanity, unlike in a wealthy and powerful nation like the United States, where the humanity of poor people, and certainly their right to full citizenship, are increasingly under attack. Ultimately, the politics of comparative suffering is always a losing and amoral proposition. It’s precisely such politics that would justify telling a Japanese American who was herded into an American internment camp during World War II that they have nothing to complain about and should actually be grateful: after all, they could have been in Tokyo when we firebombed it, or in Hiroshima or Nagasaki when we dropped the atomic bombs. It’s the kind of position that would rationalize saying to someone who survived the Holocaust of European Jewry that they had no legitimate complaint against the Nazis, since had they lived in the Soviet Union they may well have perished in Stalin’s gulag (or, for that matter, the reverse of this argument). To forward this kind of position is like telling an African American during Jim Crow segregation to get over it, since King Leopold killed roughly ten million Africans in the Congo under Belgian colonialism. In other words, this kind of comparison between the suffering one is currently experiencing and the much greater suffering one could theoretically experience elsewhere lacks all moral and practical relevance.

Not to mention, there is something ironic about this kind of argument coming from the rich, who regularly push for greater tax breaks so they can have more money with which to “do great things,” or just because they think they’ve earned it. After all, to whatever extent the poor in America are rich by global standards, surely the wealthy in America are far more so, and should perhaps rightly be seen as obsessive and gluttonous hoarders. They don’t seem satisfied with the kind of wealth that would allow them to literally buy entire countries outright, and which certainly dwarfs the wealth of the so-called rich in less wealthy nations, but yet they have the temerity to lecture poor people about gratitude?

Consider a recent commercial paid for by the Charles Koch Foundation that seeks to remind Americans how good they have it by noting that even if one earns only $34,000 a year, that’s enough to vault one into the top one percent of the world’s population in terms of income.108 Or consider the remarks of Bud Konheim, CEO and co-founder of fashion label Nicole Miller, who recently said those who are poor or working class in America should stop complaining, since their incomes would make them wealthy in India or China.109 To whatever extent one finds this kind of thinking even remotely persuasive, shouldn’t the logic of such an argument run both ways? Shouldn’t the rich in the United States stop complaining about their taxes? The regulations they have to put up with? The minimum wage they have to pay employees? Talk about ingratitude! If they lived in any other industrialized nation, the taxes they paid would be higher, regulations would be just as strict or more so, and their workers would have far greater protections and safety nets than in the United States. So when it comes to shutting one’s mouth and being grateful for what one has, perhaps the rich should lead by example.

Republican Argument: The Poor have microwaves, air conditioning, cable TV, cell phones! Don’t tell me they are poor! 

Eight-two percent have a microwave. This is 82 percent of American poor families. Seventy-eight percent have air conditioning. More than one television, 65 percent. Cable or satellite TV, 64 percent . . . Cell phones, 55 percent. Personal computer, 39 percent. So how can you be so poor and have all this stuff?112 Aside from the bizarre implication that air conditioning is a luxury the poor should not enjoy, there are a few obvious holes in O’Reilly’s argument here. First, it should be apparent to even the most casual thinker that most of the poor live in apartments pre-rigged with A/C whether or not they can afford to actually run it. Second, cable is necessary in most parts of the country in order for a television to get reception at all, so the mere fact that one has cable says very little about the quality of one’s television, let alone the extravagance of one’s entertainment habits. And finally, cell phones are no more extravagant than landlines, having more or less replaced the older systems for millions of Americans, including those who are by no means poor. To not have a phone would render a person unable to remain connected to possible jobs, to family or to emergency services. Surely we do not expect poor families to be completely cut off from the world in order to deserve concern. Or perhaps for the Bill O’Reillys of the world, that is exactly what is required.

Second, even if Rector were right and poor and lower-income persons are now able to live like the middle class did thirty to forty years ago, what is the practical meaning of this information? It is also probably the case that the poor in the 1960s had “stuff” comparable to what middle-class Americans had in 1939, but so what? The poor today also doubtless have certain luxuries unknown even to the wealthiest Americans in the 1790s, what with indoor plumbing and all, but one wonders what the point of such a comparison is. Does anyone really believe that today’s poor live better than Thomas Jefferson did, just because the latter had to crap in a chamber pot or an outhouse? Apparently, Rector and the folks at Heritage think so, as they have also made the argument that the poor in America today “live a better life than all but the richest persons a hundred years ago.”114 Though it should hardly need to be said, today’s poor do not live in the early 1970s, let alone the nineteenth century; they live in the present, where the ability to feel part of the mainstream (and to be part of the mainstream) requires one to be able to do things and have things that previous generations didn’t do or have. People didn’t “need” the Internet in the 1970s, for instance, because the Internet didn’t exist, but not having access to the web today can be seen as a pretty serious disadvantage. They didn’t need cars in 1837 either, but try finding steady employment today without one.

Not to mention, a TV with cable, air conditioning, and microwave hardly help you receive medical care if you are sick without insurance, or help you move up in the world without an ever increasingly expensive education. Cheap plastic things get cheaper and cheaper, but outside of novelties do not really contribute as greatly to well being as the ability to increase your education, feed yourself in a world of ever increasing food costs, or go to the doctor to keep from dying. Yes, we have better doctors today than in 1700, but if we ignored the claims that poverty is a problem by virtue of this, is it the same as saying poverty does not exist at all, which is too ignorant to be taken seriously.


Wikipedia – Income Inequality in the US: Introduction 


What Obama Left Out of His Inequality Speech: Regulation

Three ways Inequality is hurting everyone 

Inequality Kills 

Middle Class Series: 5 Charts that Show How Increasing Income Inequality Leads to Less Opportunity

Mobility – The American Dream 

Equal Opportunity, Our National Myth – Joseph Stiglitz

Economic Mobility of Families Across Generations – Brookings

The Mobility Myth – Timothy Noah 

The myth of the American Dream – Steve Hargreaves 

Wealth Mobility and Volatility in Black and White – Article

Wealth Mobility and Volatility in Black and White – Full PDF Report, 44 Pages

Publications and Papers

Income and Wealth Inequality: Evidence and Policy Implications

Income Inequality, Equality of Opportunity, and Intergenerational Mobility – Journal of Economic Perspectives—Volume 27, Number 3—Summer 2013