The spread of wealth inequality

Source: thedebrief.co.uk

The ‘American dream’: the idea that everyone, regardless of where they have come from, who they are, and what class they may belong to, can strive for a better and more comfortable life, provided they work hard enough. This ethos, so central to the United Sates, has since been adopted into the society of the UK and many western countries, and plays a major part in why so many foreign citizens choose these countries in which to start their new lives. Whilst America and these western countries claim the credits for the lives that have been turned around, failure of the ‘American Dream’ is most usually overlooked and more often than not, a lack of good, genuine, hard work is what accounts for these failures. What is overlooked, is something that has existed in America for generations, the difference between those who have a lot, and those who have very little – wealth inequality.

The wealth of an individual is determined by totalling the sum of their whole assets (investments, real estate, and savings) and then subtracting the total of their liabilities (credit cards and outstanding loans). It is important to understand the relation yet ultimate difference between wealth inequality and income inequality. Income inequality refers to the disparities between various revenue streams such as what an individual may receive as part of a salary, or the interest and dividends earned from savings. Whilst wealth illustrates what you possess, income reflects on the amount that you are receiving and in western countries wealth inequality is, unfortunately, far more surreptitious than the inequality of incomes.

Wealth disparities have for some time been a stark reality in the US, really propelling in the lead up to the Great Depression. By the late 1930s, the government had responded to the losses of the Great Depression and World War Two, launching policies that would help millions of veterans and family members finance for school and homes, beginning the establishment of a true middle class. In an example of racial wealth inequality, the black community at large were denied many of the benefits of these policies. The unemployment rate of black people, eventually became twice that of white people.

In America the racial wealth divide is very much still existing and has also prejudiced against immigrant families of other backgrounds. As of now, the majority of the Latin population in the US are either first or second generation immigrants. It would take the average Latin family in America 84 years to catch up to the wealth of the average white family household.

Source: thelily.com

In navigating the wealth divide, it is impossible not to consider an evaluation of the issue that is inclusive of gender. The gender pay gap is currently at its most sensitive worldwide, sure to make an impact on the future wealth statuses of generations to come, as it has done in the past. In America, exists the sad reality that a single woman in the US owns 32 cents for every dollar of wealth that is owned by a single man.

In Britain, the inequality of wealth is worsening between classes, regions, and generations and the nation as a whole is becoming a more unequal society compared to other European nations as well as its own past. This reality has been seen time and time again in real life events. The Grenfell Tower disaster not only resulted in tragic loss but served as a graphic illustration of how the lower class or less well-off communities are not listened to or paid attention to. So close geographically, but decades away in an economic respect to London’s uber rich communities.

Falling levels of home ownership in Britain were once great forces in decreasing inequalities. But now, the shifts in who owns what property, fuel the ever increasing wealth disparity between the rich and poor, whilst cutting new divides between young and old.

In 2013, the average total wealth owned by a single white man in America was $28,000 whilst single women held the average of $15,640. This is compared to the astoundingly low total of wealth of $200 for single black women. These figures have since been driven further apart in the last five years as wealth inequality becomes a problem that is harder and harder to ignore.

These consequences, once associated with the glory and hopes of the ‘American Dream’ are not the result of one group working harder than the other, or failure; it is the result of inheriting, or perhaps not inheriting, inter-generational wealth, essentially creating a completely unattainable ‘American Dream’.

Thank you for reading!

Aman