A mere 85 people control as much wealth as the poorest 3 billion people in the worlds population. That sobering fact makes it clear that the world in an unequal place, but is this economic inequality unfair? That all depends on what you believe. In this piece Nathan Palmer will explore the depths of economic inequality and discuss how the sociological concept of a justifying rationale can make you think it’s fair.
Do you want play monopoly with me?
Let’s say you and I just played a game of monopoly and I won. Would you want to play again with me, but this time I start with all of my winnings from last time? No? Why not? It’s unfair? Says who? If this is unfair then why do we the exact same thing in the real world. Each of us is born into an ongoing game of monopoly. Some of us are born to the winning families and some to the families that are losing.
My point here is that we know things are unequal, but for some reason we don’t think it’s unfair. Let’s start by looking at how unequal things are and then let’s dig into why we don’t think it’s terribly unfair.
If we put every single thing that could be owned in the country (i.e. the land, businesses, stocks, investments, etc) into one big pot, then the richest 20% of the country would own 88.9% of it all. That means that the other 80% of the country (which almost certainly includes you) is fighting over the remaining 11% of existing wealth. If we put all of the earned income into the same pot, we’d see that the top 20% earns 59.1% of that too. At the same time, poverty in the United States is higher than it’s ever been since 1928. In 2009 1 in four children under the age of six were impoverished. If we look at the global level, we find that the top 85 richest people have as much wealth as the bottom 3 billion people on earth… Let the soak in for a moment.
While I could blather on, I’d rather show you what this looks like using a video. But before I show it to you, I should tell you that the video is not without it’s flaws (read more about them here). However, the general gist (i.e. things are more unequal than we think they are) is still valid. So with that, here you go:
Justifying Rationales & Inequality
Every society has some form of inequality. This means that every society needs something to justify the inequality. In sociology we use the term Justifying Rationales to describe the ideas and stories we tell ourselves to explain away any sense that inequality is unfair or unjust. In the United States our justifying rationale is called meritocracy. I’ll explain what this means in a second, but first I want you to see what it looks like for yourself:
In the United States we are told that we have a meritocracy which is a system that rewards those who work hard, take advantage of their opportunities, and are talented/skilled. You rise and fall in a meritocracy based on your individual actions. Put simply, in a meritocracy “you get what you deserve and deserve what you get” as the saying goes. So if you’re rich, you must have earned it and if you’re poor, well it’s you’re fault. From Horatio Alger stories of the [late 1800s] to The Pursuit of Happyness in 2006 to The Social Network in 2010 we have all been told over and over again that if you work hard you will be successful.
While it may be true that if you don’t work hard you won’t be rich, the logic behind a meritocracy is truly flawed. For instance, hard work isn’t associated with more money. Look at any corporation and you’ll see that hard work doesn’t predict your wage. How high you are on the organization chart does. Take a company like Apple, the CEO Tim Cook made 4.2 million in 2012 which is hundreds of times greater than the lowest paid worker in the company. While I think Mr. Cook is providing a valuable service to his company, we can’t say that he is working harder than the Chinese workers who put in 60 hour work weeks in harsh factories snapping iPhones together.
Now answer me this: what’s the most common way someone becomes rich? Think about it. I’ll even give you a hint, it’s the same way that most people become poor. That’s right, birth. Most wealthy adults were born into wealthy families and most poor adults have lived their entire life in poverty (if this interests you check out this report).
Today you and I are playing a game of monopoly that was won long before we were born. It’s true that some of us will defy the odds and raise our standing in life, but our success will be the exception to the rule. Our justifying rationale, what many call the meritocracy myth, may keep the masses at bay, but if inequality increases as it has for the last 30-40 years, one has to wonder how much longer it will hold.
- Why do you think the idea that the U.S. is a meritocracy is so popular?
- What if we told our children and ourselves the truth (i.e. things are unequal, have been for a long time, and inequality is on the rise)? What would happen then?
- A lot of popular media features the rich flaunting wealth. From Lifestyles of the Rich & Famous to My Super Sweet 16 to MTV’s Cribs to Keeping Up With The Kardashians we see that America has a thirst to view how the wealthy live. Why do you think these shows are so popular?
- Re-watch the Cadillac commercial above. Describe in your own words how it reinforces our belief in a meritocracy? Even if personally you don’t think it does, explain why someone else might think it does.
My friends in economics are screaming right now because wealth can grow. People can start new businesses, invent new technologies, provide new services and create more wealth. But it’s still true that nearly 90% of existing wealth is controlled by just 20% of the population. ↩
But the gap between the top earners and the bottom can vary a great deal. For instance, in the late 1970s the U.S. was far more equal than it is today. ↩