Media(te) the economic equality debate
November 28, 2011
A staggering number of media columnists and vaunted intelligentsia dismiss the issues of the expanding inequality gap in America. From publications diverse as the Wall Street Journal to The Flat Hat, these apologists believe that aiming astringent assaults on the Warren Buffets and Bill Gates of the world is the equivalent of “class warfare” and ignores the storybook success of the middle-class. Granted, these seasoned professionals carry inherent bias that conforms to their own personal backgrounds and career trajectory, but more appalling is their wanton lack of understanding on the topic of inequality economics.
Modern media narratives tend to seduce readers with provocative views on timely issues but often fall short of covering the subject with sufficient depth and complexity. In the case of America’s widening inequality, the vast majority of columnists can be partitioned into supporters or opposers of disparity concerns in the United States. However, any student who has wallowed through enough economics can recognize that the bow of inequality can be profoundly influenced by the distribution of income in the economy.
In an equal world, 25 percent of the population world control 25 percent of the wealth and so forth for the remaining quartiles. However, the complexities of inequality get far more muddled when the composition of wealth is highly concentrated in low percentiles.
In America’s case, the hard data points to diminishing real wages for the vast majority of the middle class over the past three decades, and the lost share of economic ownership has been absorbed by the ultra rich.
As of Fall 2011, the United States Census Bureau has reported an unprecedented prevalence of poverty in America, totally 50 million people below the United States designated poverty line. To put the numbers in perspective, that is about one sixth of our nation’s population. Likewise, the Bureau of Labor Statistics has illuminated the precipitous decline of the middle-class wage. The recession unquestionably contributed to these stark figures, but the trend precedes the 2008 crash. In terms of real wage, the Bureau of Labor Statistics has noticed a significant decline for the middle class since the late 1980s.
Meanwhile, as the existence of the middle class faces severe stress, the rise of hyper inflated executive salaries has overtaken the business world. In the 1970s CEOs made 40 times more than the average salary worker. Today, CEOs earn over 400 times more than the average salary. Considering that many of the industries have not changed dramatically, why should a company’s profits disproportionately benefit the executives instead of rewarding the workers in the company? This is an issue of deserved wealth and how to utilize profit margins ethically.
CEOs are an integral part of any business hierarchy, but more often than not their exorbitant payrolls and severance packages do not merit the value they add to the company. Americans take pride in our ever-evolving meritocratic system, but bad executives receive multimillion-dollar severance packages for doing a poor job.
Inequality is inevitable, but a drastic imbalance of wealth is cause for great concern in any society. For those apologists who continue to scoff at the widening inequality statistics, the problem often lies in the misconception between relative wealth and absolute wealth. If a person like Bill Gates continues to amass billions off of his innovative computer products, then he deserves it. However, if executives are lining their pockets in bonuses at the expense of middle-class real wages, then our society should peer into its consciousness and try to reform where we have gone astray.