U.S. Income Inequality Now Worse Than In Many Latin American Countries

[TruthOut10]

Latin America has long been viewed as a region plagued by some of the worst wealth inequality in the world.

But in recent years, those figures have turned around, while in the United States income inequality is on the rise.

Adam Isacson, analyst for the Washington Office on Latin America, notes the change on his blog. According to recent figures on income published by the U.N. Economic Commission for Latin America and the Caribbean, the U.S. income gap now exceeds that of several countries in the Americas. As Isacson writes:

The United States (wealthiest 20% earns 16 times more than the poorest 20%) is now in the middle of the pack. In 1980, the U.S. number was 10.5.

U.S. Income Inequality Worse Than Many Latin American Countries

 

[Mr. H.]

I'm sure most would rather be poor here than poor there.

 

[asterism]

Seems to me this is a because of some very progressive "reforms" in Latin America. So are the poor in Latin America any less poor as a result?

No. They are still quite poor.

 

[kiwiman127]

Income inequality doesn't fly real well in these boards. I find it troubling that people don't care that they are making less than they did 40 years ago and are going no-where income wise. Some don't care, some don't realize it and others have accepted it and gave up.

 

[asterism]

Income inequality doesn't fly real well in these boards. I find it troubling that people don't care that they are making less than they did 40 years ago and are going no-where income wise. Some don't care, some don't realize it and others have accepted it and gave up.

Why should inflation adjusted wages go up if there is a lower marginal value to that labor?

 

[Rshermr]

Income inequality doesn't fly real well in these boards. I find it troubling that people don't care that they are making less than they did 40 years ago and are going no-where income wise. Some don't care, some don't realize it and others have accepted it and gave up.

Why should inflation adjusted wages go up if there is a lower marginal value to that labor?

Uh, interesting claims. Do you have some proof of your statement, or is it simply opinion???

If you read this, you will get some idea of what is going on in the real world. It is greatly different than the right wing talking points going around this board:

Top 1% Got 93% of Income Growth as Rich-Poor Gap Widened - Bloomberg

In terms of labor productivity, the US was number 3 among the 38 OECD countries. And productivity has been increasing year over year.
http://www.bloomberg.com/news/2012-...-income-growth-as-rich-poor-gap-widened.htmle

So, in all, the numbers show high labor productivity, and growing labor productivity, and level wages. So, we rate very high in labor productivity in this country, but continue to outsource that labor due to much lower labor prices in a few other countries. While labor productivity in this country is close to 9 times that of China, the labor rates of china are so low it still makes money for us manufacturers to outsource manufacturing to that country. Though that dynamic is changing as the cost of labor in China rises.

 

[asterism]

Income inequality doesn't fly real well in these boards. I find it troubling that people don't care that they are making less than they did 40 years ago and are going no-where income wise. Some don't care, some don't realize it and others have accepted it and gave up.

Why should inflation adjusted wages go up if there is a lower marginal value to that labor?

Uh, interesting claims. Do you have some proof of your statement, or is it simply opinion???

If you read this, you will get some idea of what is going on in the real world. It is greatly different than the right wing talking points going around this board:

Top 1% Got 93% of Income Growth as Rich-Poor Gap Widened - Bloomberg

You need proof that there is lower marginal value to low and medium skilled labor?

Where are iPhones made and how much does it cost per unit?

 

[Saigon]

It's a sad day when Americans have to be satifised with being no worse than Honduras, but it seems to be popping up on threads about gun control (We have less homicides that Venezuela!) and now also here.

Income inequality should be seen as a crsis right across the world, but there is no question that the US is in more trouble on this issue than most other developed countries, where the awareness as least seems to be higher.

 

[auditor0007]

Income inequality doesn't fly real well in these boards. I find it troubling that people don't care that they are making less than they did 40 years ago and are going no-where income wise. Some don't care, some don't realize it and others have accepted it and gave up.

What troubles me is that so many cheer it on and believe it's a good thing for America, when in fact it is helping to reduce the average American's standard of living.

 

[Meathead]

It's a sad day when Americans have to be satifised with being no worse than Honduras, but it seems to be popping up on threads about gun control (We have less homicides that Venezuela!) and now also here.

Income inequality should be seen as a crsis right across the world, but there is no question that the US is in more trouble on this issue than most other developed countries, where the awareness as least seems to be higher.

Income inequality is a fact of life, always was and always will be. The "crisis" is a misguided one.

Obviously, the same forces behind the "inequality" are bringing significant measures of global equality. China and India's progress with their emerging middle classes able to purchase for the first time what Americans have long considered birthrights bear witness to this.

Would you be willing to accept national income equality and a lower standard of living in return for higher wages for a less productive segment of the workforce? The paying of people at higher rates for less production than can be had elsewhere will invariably raise the cost of living. Would you further accept the loss to those countries which have only recently been able to reap the benefits by access to foreign markets?

This is perhaps a philosophical question for those bleeding hearts among us. Is it ok to resolve income disparity at the cost of those who are far, far poorer than those your heart bleed for domestically?

I fully expect any response on this to dissolve to a useless make-the-rich-pay rather than a market force argument.

 

[Saigon]

Meathead -

I'm a capitalist, and capitalism means that there SHOULD be disparity of income. Rewards should be based on the work involved put into the task.

However, we have gone from a situation around the world where the difference between a CEO's income and the average income in that firm has risen from something like 40:1 to 450:1.

I consider that exploitative and unfair to the point of being a bastard interpretation of what capitalism is all about.

I work with firms where salaries have remained stagnant for 5 years - during which time the CEO's income has risen 20%. That is simply not right.

 

[Meathead]

Meathead -

I'm a capitalist, and capitalism means that there SHOULD be disparity of income. Rewards should be based on the work involved put into the task.

However, we have gone from a situation around the world where the difference between a CEO's income and the average income in that firm has risen from something like 40:1 to 450:1.

I consider that exploitative and unfair to the point of being a bastard interpretation of what capitalism is all about.

I work with firms where salaries have remained stagnant for 5 years - during which time the CEO's income has risen 20%. That is simply not right.

You're dodging the question. As a self-professed capitalist, should people be paid what the market will bear? Should competition be global or domestic labor market be protected at a cost to the consumer and the even more downtrodden than the western worker? Does one's heart bleed more profusely at the tribulations of the domestic worker than those in foreign countries who might be able to purchase a TV or washing machine for the first time (and in large part because of the production of such products with cheap labor)?

Finally, and perhaps directly to the point, should there be a maximum that people are allowed to make because theoretically that would increase the income of middle-income earners? If "A" were not so wealthy, than "B" would be wealthier? Is it really a zero-sum game?

A lot of questions, no doubt.

 

[Saigon]

Meathead -

I am a capitalist, but that doesn't mean I believe in blind obediance to some all-knowing "market".

I have no idea where this idea came from that capitalism is supposed to mean some kind of subserviance to merchant bankers, venture capitalists and those who oppose all regulation.

I think firms should do business in a manner that is ethical, sustainable and fair to all. I think firms should be good citizens in their community.

Ultimately I think firms are better off in the long tern by genuinely rewarding and motivating staff; by promoting from within, by investing in training, and by paying fair salaries and attracting & retaining good staff.

 

[Meathead]

Meathead -

I am a capitalist, but that doesn't mean I believe in blind obediance to some all-knowing "market".

I have no idea where this idea came from that capitalism is supposed to mean some kind of subserviance to merchant bankers, venture capitalists and those who oppose all regulation.

I think firms should do business in a manner that is ethical, sustainable and fair to all. I think firms should be good citizens in their community.

Ultimately I think firms are better off in the long tern by genuinely rewarding and motivating staff; by promoting from within, by investing in training, and by paying fair salaries and attracting & retaining good staff.

Sorry. I was sort of looking for a serious exchange. Thanks for getting back to me anyway.

 

[waltky]

When ya consider the executive pay to employee wage is often 24:1...

... is it any wonder?

 

[Rshermr]

It's a sad day when Americans have to be satifised with being no worse than Honduras, but it seems to be popping up on threads about gun control (We have less homicides that Venezuela!) and now also here.

Income inequality should be seen as a crsis right across the world, but there is no question that the US is in more trouble on this issue than most other developed countries, where the awareness as least seems to be higher.

Income inequality is a fact of life, always was and always will be. The "crisis" is a misguided one.

Obviously, the same forces behind the "inequality" are bringing significant measures of global equality. China and India's progress with their emerging middle classes able to purchase for the first time what Americans have long considered birthrights bear witness to this.

Would you be willing to accept national income equality and a lower standard of living in return for higher wages for a less productive segment of the workforce? The paying of people at higher rates for less production than can be had elsewhere will invariably raise the cost of living. Would you further accept the loss to those countries which have only recently been able to reap the benefits by access to foreign markets?

This is perhaps a philosophical question for those bleeding hearts among us. Is it ok to resolve income disparity at the cost of those who are far, far poorer than those your heart bleed for domestically?

I fully expect any response on this to dissolve to a useless make-the-rich-pay rather than a market force argument.

You need to spend a year or so reading some books about why economies fail And why nations worry about income inequality. For instance, if you google income inequality and China, you would see that their major issue right now is income inequality.

If you do that, and you are intellectually honest, you will come back with a much different set of arguments. Because what you have today is the simple argument that is present in every country, ad which comes from the very wealthy. Some part of the very wealthy, actually. And in our country comes from the republican party who are owned by the very wealthy. By the way, before you start, I know that dems are also largely owned. But not completely. Yet.

You could start by reading this, and wondering:
Top 1% Got 93% of Income Growth as Rich-Poor Gap Widened - Bloomberg

 

[eflatminor]

And if a fat man is standing next to a skinny man, the fat man MUST have taken the skinny man's food.

America's poor are still considered wealthy by world standards, but that's just not good enough for the Marxists. Caring about what another person makes is nothing more than rabid jealousy. How sad.

 

[eflatminor]

I work with firms where salaries have remained stagnant for 5 years - during which time the CEO's income has risen 20%. That is simply not right.

So quit.

 

[Rshermr]

And if a fat man is standing next to a skinny man, the fat man MUST have taken the skinny man's food.

America's poor are still considered wealthy by world standards, but that's just not good enough for the Marxists. Caring about what another person makes is nothing more than rabid jealousy. How sad.

So you say. And that would be your opinion.
So, why do you think the Chinese worry so much about income disparity?

 

[Oddball]

Ahhh....Time once again for the Marxist's favorite boogerman....The dreaded "income inequality"...

6 Myths About Income Inequality in America

In 2010, the U.S. Census Bureau reported that the share of income for the top 20% was 50.2% and only 3.3% for the bottom quintile. Some consider this widening spread between the "rich" and the "poor" to be the primary problem for our economic woes. One argument is that the rising share of income in the hands of those at the top of the income ladder has slowed economic growth, primarily from their preference to save. Proposals to solve this problem recently included a surtax on millionaires and other measures to redistribute income from those who save to those who consume.

During the 2008 presidential campaign, then Senator Barack Obama discussed his views on income inequality with "Joe the Plumber" by stating, "I think when you spread the wealth around, it’s good for everybody." Not only are these types of policy choices unlikely to reduce the gap between upper and lower income households, but the last forty years of economic data reveal that the presumed negative effects from income inequality are based on the following 6 myths.

<snip>

A quote by Will Wilkinson, from the Cato Institute, summed up this concern quite succinctly: "Income inequality is a dangerous distraction from the real problems: poverty, lack of economic opportunity, and systematic injustice." Moving forward we must keep the myth of income inequality in mind and deter our attention away from class warfare and towards areas that will benefit everyone.

The great economist Milton Friedman once said, "A society that puts equality before freedom will get neither. A society that puts freedom before equality will get a high degree of both." These are wise words for moving forward in America.

6 Myths About Income Inequality in America