CQ Researcher contributor, Sarah Glazer, defines income inequality as, “the term used for the growing disparity between the incomes of society's poorest and wealthiest sectors.” It happens when the wealthiest quintiles have a rate of income significantly higher than lower quintiles. Quintiles are the five income groups economists divide society into: the wealthiest on top and the poor on the bottom. Income inequality does not mean every citizen does not earn the same amount of money, it means the rate of change in salaries is not consistent among classes over time.
The current trend of income inequality has been growing since the 1970s. Social policy reporter Marcia Clemmitt reports from 1979 to 2007, the average net-pay of the lowest fifth quintile increased by 16 percent while the rate of change for the top fifth quintile was 35 percent and 281 percent for the wealthiest one percent. The wealthiest quintiles are rapidly earning more while growth for middle and lower classes are stagnant.
Nobel Prize winning economist Joseph Stiglitz found since 2009, “Ninety-five percent of all income gains […] have gone to the top 1 percent.” Meanwhile, median income in America hasn’t moved in almost a quarter-century. This shows income inequality benefits top earners, but hurts middle and working class Americans who do not see as much growth. Stiglitz notes that income inequality is the result of “tax decreases for the rich and the easing of regulations on the financial sector.”
The government since the 1980s is guilty in allowing income inequality to form, and it might get worse come the next administration. Income inequality is deleterious to America. It creates a plutocracy that obstructs economic growth and polarizes social classes.
A plutocracy empowers the wealthiest quintile to take complete control of the government. Most support trickle-down economics, rewarding the rich through tax-breaks and loopholes, while the needs of the middle and working classes are neglected. Influence in government is shifting from the public’s voice to the wallets of the wealthy.
Martin Gilens, an associate professor of politics at Princeton University states, “’The ability of citizens to influence public policy is the ‘bottom line’ of democratic government,’ […] the ability to influence policy has skewed toward the most affluent people, whose priorities often don't coincide with those […] who earn less." If this continues, the United States will turn into that plutocracy where the wealthy few controls the nation, and it is happening now more than ever.
President-elect Donald Trump's cabinet is poised to fit the definition of plutocracy. His most valuable picks include: Besty DeVos-Secretary of Education, $5.2 billion; Steven Mnuchin-Secretary of the Treasury, $40 million; Wilbur Ross-Secretary of Commerce, $2.9 billion, Rex Tillerson-Secretary of State, $150 million; Jeff Sessions-Attorney General, $7.5 million; Dr. Ben Carson-Secretary of HUD, $30 million; Tom Price-Secretary of HHS, $13.6 million; Elaine Chao-Secretary of Transportation, $ 22.8 million; Linda McMahon-Administrator of the Small Business Administration, $500 million; and RIck Perry-Secretary of Energy, $3 million. Not to mention, the future POTUS is valued at $3.7 billion. Mike Pence, the elect's VP, lives a respectable life with a net worth of about $210,000.
The candidates that will form the American plutocracy are already in place. No longer will the wealthy be buying politicians--they are the politicians. This is the result of income inequality that has been rising over the last three decades. Money talks, and unfortunately the loudest voices are in the wallets of one percent of Americans. The rest of us have become silent. In the coming weeks, the economic and social consequences of income inequality will be reported. I'm sure someone can benefit from a plutocracy, but who benefits the most? A government is needed that will be a friend to the people--to benefit the majority, and not the wealthy few. President Theodore Roosevelt once put it, “The government is us; we are the government, you and I."
