Is Income Inequality That Bad?
The rich are getting richer and the poor are getting poorer. Well this is also an understatement to the level of inequality these days.
Over the century humankind has made tremendous progress. Technologies were developed, economies prospered, and people were lifted out of poverty. But at the same time the inequality also touched the sky.
We need to understand that there are two main types of economic inequalities. First is income inequality, followed by the second, which is wealth inequality.
Income inequality denotes how uneven the income distributed among a group of people. The more the equal distribution, the lesser the inequality, and vise versa.
And as far as wealth is concerned, you must be knowing, wealth is the sum of your total assets minus the liabilities. And wealth inequality means uneven distribution of wealth.
To analyze the level of income inequality, we can look at the Gini index. The Index can range from 0 to 100, with a higher level showing greater income inequality among a country’s population and vice versa. South Africa has reported one of the highest income inequality, with the Gini index of 63%. Followed by brazil at 53%. And if you look at the west, the United states has the highest inequality, with the Gini index of about 43%.
We are not saying that economic inequality is a good thing, but it is rather the side product of capitalism. We cannot completely erase it but we can control it.
Giving everyone an equal opportunity could be a solution. It can be done by giving quality education not just to the rich but also to the poor. Educating students with necessary skills could play a big role to increase the productivity of any nation.
At the same time, progressive taxation also might be a good idea. This will reduce the tax burden on those with a lower ability to pay, and it will shift the high taxes to those with a higher ability to pay. The money collected then, can be used for healthcare coverage, unemployment, insurance, and in many other social welfare programs. These changes could be helpful for providing the equal opportunity for everyone.
In the end we can say, Economic inequality is a tricky issue. Some level of inequality may be natural. But if inequality rises to an exponential level, then it could be a disaster to all mankind. The inequality that we see in the world today is the consequence of unequal progress. Our generation has the opportunity and responsibility to allow every part of the world to develop and transform into a place where health, access to education, and prosperity is a reality. The issues of fairness and equality of opportunity lie beneath the issue of economic inequality. And It's up to each of us to decide what we want economic equality or inequality to look like.
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