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Income Equality Or Inequality – Which One Is A Problem?

September 6, 2022

The distribution of wealth in the United States of America has become a heated debate ever since the COVID-19 Pandemic hit and people saw that billionaires continued to rack up their wealth, leaving the working class to suffer amid the rising inflation. While many people believe that the biggest problem at hand is income inequality, experts believe that the real problem is the growing number of income equality among the bottom 60% of household earners.

If you are interested in knowing more, then keep on reading as you’ll get a chance to dive deep and understand the income equality problem that many households suffer from in the U.S.

Karolina/Pexels | This one might have you questioning a lot of things

Becoming The Majority

To truly understand the problem, you need a bit of context, which is why we must go back to the basics. From 1967 to 2017, the real government transfer payment, which is given to the bottom 20% of household earners, rose by a whopping 269%. On the other hand, middle-income households witnessed an increase in their earnings by 154% after taxes in the same period. This statistic clearly shows that bottom-earning households have come close to middle-income households when it comes to their earnings. This means that 60% of Americans now have an equal income. This equality has decreased the labor rate in low-income households and created a populist realignment that has since been dominating American politics.

Karolina/Pexels | This just means that middle-earning households are not climbing the financial ladder

The Wrong Facts

At this time, you can’t even trust the census bureau to provide you with the right statistics! It has reportedly been overstating the current income inequality between the highest and lowest 20% earners. The census bureau also claims that the inequality between the two groups has increased to more than 300%. They also said that since 1967, income inequality has risen by 21%, while, in reality, it has fallen by 3%. This was the least shocking part of the situation. It is reported that the census bureau showed that there is an extraordinary increase in the equality of the income of the bottom 60% of the American household, despite the unemployment status.

John/Pexels | It's true income equality is the greater evil

Political Plight

These haunting statistics only uncover the truth behind why there is instability in the democratic political alliance amongst blue-collar workers and welfare recipients. This instability was rising during the 1980s and was called the Regan Democrats, and then it came to light under Trump’s blue-collar political base. This led to another group joining the list, the Hispanic voters, who comprise a significant percentage of the middle-income households. This situation has not only become one of America’s biggest problems, but it has also shaken the foundations of American prosperity. If there’s one thing about the democratic society, it is that it is not ready to tolerate it anymore.

Despite working harder and doing difficult jobs, middle-earning households are making just as much as a household that gets welfare from the government. You tell me, is that fair or not?

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