The Social Class Gap: Economic Inequality in America Essay

In the United States, there is a huge gap between the incomes of the richest citizens and the poorest. The gap between rich and poor Americans is growing at a tremendous rate. Moreover, the global crisis affected most of all ordinary citizens of the United States, while the state helps the millionaires actively. Warren E. Buffet, the chairman and chief executive of Berkshire Hathaway, an American business magnate, investor, and philanthropist, states that wealth is unevenly distributed among the US population, a small part of Americans accumulate the basic income of the whole society in their hands. Thus, the main aim of the assignment is to explore the issues associated with the social class gap in America.

The issue of economic inequality in the United States is invariably relevant not only among American historians, as well as in general social scientists, but also among public figures, politicians, and in the broad circles of the American public. Noam Scheiber, a writer for The New York Times, a former senior editor for The New Republic, mentions that modern society needs changes because the constant growth of inequality was historically laid in the economic systems of Europe and the US, but because of the world wars and the Great Depression this process reversed (Scheiber, 2015). At the heart of the perception of this problem were always important ideological motives. The main one stems from a different interpretation of the equality category, which has acted as one of its core values since the emergence of American civilization.

John Nichols, a liberal American journalist, the associate editor of The Capital Times, also mentions that in the minds of many Americans, as well as generally in the national consciousness, it means equality of opportunity (Nichols, 2014). This interpretation provides a basis for justifying economic inequality, since in the presence of equality of opportunity, individuals with different abilities achieve different life outcomes. However, in recent years, the number of those Americans has increased, including among researchers who believe that society, through reforms, must provide a certain leveling of the results of citizens’ activities, because there is no exemplary equality of opportunities in real life and because excesses of poverty in a developed modern society are unacceptable. The marked worldview difference seriously influences the approaches and conclusions of American researchers who address the problem of economic inequality.

Carl Shapiro, the Transamerica Professor of Business Strategy at the Haas School of Business at the University of California, Berkeley, an economist at the University of California, Berkley states that the progress in information technologies gains “breathtaking” scales, while it still unable to give the greater economic security for the American middle class (Porter, 2013). People with small incomes can get the impression that for several years, their lives have improved significantly due to the high growth rates of the country’s economic well-being, but in fact, 1% of the super-rich population benefits more from this.

According to Patricia Cohen, a reporter for The New York Times, an award-winning reporter, the economic inequality between the rich and the poor has been growing steadily since 1970 in the US, and has now reached an unprecedented level (Cohen, 2017). This happened despite the fact that about 47% of Americans live below the poverty line. This situation is reflected in the economy of the country when the rich in the majority try to protect their income from taxes, and they usually spend a smaller percentage of their income, thereby limiting state tax revenues. Accordingly, with a slowdown in the growth of tax revenues, states are faced with the choice of either increasing taxes or cutting costs in order to balance the budget. As a result, this, naturally, is reflected in the social sphere, which becomes one of the articles of spending cuts for a particular state. The state has to stimulate economic growth by investing in infrastructure, education and social programs, but without a certain level of tax revenue, such actions are very risky.

Tara Dijulio, a spokeswoman for General Electric, a Director of Global Public Affairs for GE, considers such a grandiloquent statement premature and even unreasonable, mentioning that “G.E. is one of the largest payers of corporate income taxes” (Cohen, 2017). However, it would be wrong to state that only big corporations are guilty in the presence of the social gap between rich and poor Americans. To solve the problem of inequality, researchers must first understand its causes, but thousands of studies have so far failed to provide answers.

In proving his opinion, Warren E. Buffet, the chairman and chief executive of Berkshire Hathaway, a world famous billionaire, claims that the state should stop coddling the super-rich (Buffet, 2011). He considers that the weakening of effective state power, restraining unjust enrichment, led to the creation of a small class of extremely rich people whose goal is to retain and increase their power. As a result, he believes in a progressive tax scale that grows in proportion to the size of their estates.

Michael J. de la Merced, a reporter of the New York Times, a person who knows much about mergers and acquisitions, bankruptcies and the private equity industry, shows the world that Warren E. Buffet’s claims should be considered with a great attention because Warren Buffet is a person who knows the life not only from its luxury side, but from inside, while his ideas are fresh and interesting even nowadays (De la Merced, 2017). In super-rich people, incomes and wealth are formed not by wages, but by income from capital. Unlike labor and wages, money makes money and it turns out positive feedback – a vicious circle. Perhaps, in this lies the high-speed enrichment of the upper super-rich people.

Into the acknowledgment of the previously mentioned fact, Ben Stein, a lawyer, writer and actor, a commentator on political and economic issues on many media channels, states that class warfare has its place in modern society (Stein, 2006). Moreover, it only seems that tax cuts make life easier for the population. In this situation, the winners are the owners of large capital, who receive free resources to influence public policy. In many countries, after lowering the upper marginal rate of income tax, there has been an explosion of excess revenues, which have increased the political influence of beneficiaries on changes in tax legislation. The beneficiaries were the rich, who were interested in keeping the upper tax rate unimportant (Dionne, 2015). This unleashed their hands and opened the way to financing political parties and effective lobbying of their interests.

In conclusion, we have explored the issues of economic inequality from various perspectives and have proved that inequality is common, for all generations and for all industries. Inequality is not the result of “technology” and “education” – modern euphemisms for the cult of superiority of the ruling class – as liberals and conservative economists and journalists like to claim. Inequality is the result of low salaries based on big profits, financial fraud, government handouts of many trillion dollars and tax evasion for many millions of dollars (Manera, et al, 2017). The ruling class mastered the “technology” of exploitation of the state, due to the robbery of the treasury, as well as the exploitation of the working class. Workers pay disproportionately high taxes on the maintenance of education, health, social and public services, as well as subsidies for billionaires.

As a result, workers who live on wages are less organized and less influential. They work longer and for less money, suffer from less protection in the workplace and from injuries (physical and psychological), as well as lose their health and ability to work, drop out of the system, die from different diseases and, in the process of this, provide unimaginable profits for the class of billionaires. Thus, it is necessary only to hope that the world science will eventually help society to deal with the issues both in theory and in practice, and ordinary children will live in a happier society in future because the class of capitalists achieves the same regressive policies, promoting inequality, fighting for a share in profits.

Works Cited

Buffet, W. “Stop Coddling the Super-Rich.” The New York Times, 2011. Available at https://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html

Cohen, P. “Profitable Companies, No Taxes: Here’s How They Did It.” The New York Times, 2017. Available at https://www.nytimes.com/2017/03/09/business/economy/corporate-tax-report.html

De la Merced, M. “Becoming Warren Buffett’ Goes Beyond a $74 Billion Fortune.” The New York Times, 2017. Available at https://www.nytimes.com/2017/01/29/arts/television/becoming-warren-buffett-goes-beyond-a-74-billion-fortune.html

Dionne, E. “How Government Helps the 1%: The Poor Pay More.” The Charleston Gazette, 2015. Available at https://www.questia.com/article/1P2-37577563/how-government-helps-the-1-the-poor-pay-more

Manera, C., et al. “United States of America, European Economy and Inequality: A Perspective from the Economic History, 1910-2011.” The European Journal of Comparative Economics, vol. 14, no. 1, June 2017. Available at https://www.questia.com/library/journal/1G1-501246256/united-states-of-america-european-economy-and-inequality

Nichols, J. “MLK: Our Struggle is for Genuine Equality, Which Means Economic Equality.” The Nation, 2014. Available at https://www.thenation.com/article/mlk-our-struggle-genuine-equality-which-means-economic-equality/

Porter, E. “America’s Sinking Middle Class.” The New York Times, 2013. Available at https://www.nytimes.com/2013/09/19/business/americas-sinking-middle-class.html

Scheiber, N. “To fight income inequality, lifting the poor isn’t enough.” The Dallas Morning News, 2015. Available at https://www.dallasnews.com/business/money/2015/07/08/to-fight-income-inequality-lifting-the-poor-isnt-enough

Stein, B. “In Class Warfare, Guess Which Class Is Winning.” The New York Times, 2006. Available at https://www.nytimes.com/2006/11/26/business/yourmoney/26every.html

The terms offer and acceptance. (2016, May 17). Retrieved from

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"The terms offer and acceptance." freeessays.club, 17 May 2016.

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freeessays.club (2016) The terms offer and acceptance [Online].
Available at:

[Accessed: March 29, 2024]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: March 29, 2024]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: March 29, 2024]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: March 29, 2024]

"The terms offer and acceptance." freeessays.club, 17 May 2016

[Accessed: March 29, 2024]
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