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Income Gap Widens - The American Dream Is In Sweden

Posted by Jane Akre
Friday, October 24, 2008 2:44 PM EST
Category: Major Medical, Protecting Your Family
Tags: Financial Security, Financial Markets, Income Gap, Wealth Gap, The American Dream, Housing Market, Stress

The middle class is eroding in the U.S. according to 30-nation report.

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IMAGE SOURCE: ©iStockphoto/ money growth/ author: blackred

 

Social mobility is defined as children doing better financially than their parents.

That is not happening in the U.S. according to a 30-nation economic report, “Growing Unequal,” released this week.

The “American Dream” of social mobility is threatened by inequity between the rich and the poor and the gap is getting bigger in the world’s richest countries, particularly the United States. 

The “American Dream’ can more likely be found in Denmark, Sweden and Australia, the report finds. It can least likely be found in countries with the highest inequality such as the U.S., Italy and the United Kingdom.

In this 20-year study of member countries by the Paris-based Organization for Economic Cooperation and Development (OECD), wealthy families, found particularly in the U.S., Canada and Germany, are leaving middle-income earners far behind, those most likely to be hurt in a long recession.

The two-decade report covered a time when global trade took hold, the internet allowed us to communicate in new ways, and developed nations experienced overall strong economic growth.

The U.S. has the most poverty and inequality. Mexico and Turkey follow. France has seen inequities fall as poorer workers experienced an increase in wages.

In the U.S. the “haves” earn an average of $93,000, the poorest, the “have-nots” earn an average of $5,800.

Income inequities polarize societies, “making it harder for talented and hardworking people to get the rewards they deserve,” the report concludes.

With several OECD countries already in recession, the report raises the "key question"  - whether governments can prevent a possible drop in top earners' incomes from sparking "a second wave" hit to the lowest-income households, said Martin Hirsch, France's high commissioner for fighting poverty, at a news conference.

Children and young adults are now 25% more likely to be poor than the population as a whole. 

Single-parent households are three times as likely to be poor than the population average. And yet OECD countries spend 3 times more on family policies than they did 20 years ago. #


9 Comments

Anonymous User
Posted by Desmond Armstrong
Friday, October 24, 2008 3:47 PM EST

Income inequity has been a motivating factor for socialistic and communistic revolutions. Socialism is not necessarily bad, but it requires a higher level of altruism than many societies possess, and unscrupulous leaders have manipulated the system, resulting in totalitarian governments.
The rapid increase in inequity in the USA is making the country ripe for such a revolution.

Anonymous User
Posted by dick
Friday, October 24, 2008 3:56 PM EST

Revolutions are caused by the intellectuals from the upper class, not the poor. The movement needs a strong and ruthless leader.

Anonymous User
Posted by steve
Friday, October 24, 2008 4:23 PM EST

This news is not as significant as the fact that there is greater mobility between economic classes in the US...plenty of people here move up, and plenty of wealthy people screw up and end up at the bottom of the heap. Most successful people made multiple attempts before 'making it', having going broke repeatedly in between. The great thing about economic life here is not guaranteed outcome or comfort, but that with hard work, determination and/or luck, you just might hit it big.

Anonymous User
Posted by Stewart Nusbaumer
Friday, October 24, 2008 10:13 PM EST

Americans can't handle the truth. They have been sold a bill of goods that is driving most of them down. It's been well know for several decades that those societies with an active government and redistribute wealth and an educated workforce are the most successful societies. Meanwhile America races to join the ranks of the "banana" republics of the world. This election is a watershed, which way will it go?

Anonymous User
Posted by sam
Friday, October 24, 2008 11:49 PM EST

Nevertheless, the US is still a country with opportunities for the poor. My father operated a laundry when I was growing up and he has saved for a house. I completed college with help from the GI Bill and through hard work and determination I broke the rank and became the CFO of $100 million company. And through the business cycles of up and down, I have not ever been unemployed. One just has to have goals in life and work hard to attain these goals.

Anonymous User
Posted by stbdtac
Saturday, October 25, 2008 12:01 AM EST

That hard work may get you there is true, if you throw a little luck in with it. But having connections &/or a total lack of ethics will for sure get you there.

Anonymous User
Posted by Stewart Nusbaumer
Saturday, October 25, 2008 11:44 AM EST

Sam,
You are talking about the past when greater opportunity existed, when the American Dream was much stronger. After 8 years, millions of Americans are now staring at the American Nightmare. My point was other countries are smarter and have better organized societies that allow for more opportunity than what we now have. Sure there are still opportunites to rise up from the bottom or the near bottom, but they are less and less. On the other hand, Americans seem to understand our country took a wrong turn and this election might be the beginning of the return for the Dream. We'll see.

Anonymous User
Posted by peterhailey
Sunday, October 26, 2008 2:57 AM EST

Top wage earners earn $93,000 ? More like 93 million

Anonymous User
Posted by Peter hailey
Sunday, October 26, 2008 3:21 AM EST

The disparity of wages between rich and poor is only a small part of the poverty picture. America has a government that supports illegal immigration and lack of border security as a way of providing abundant cheap labor that benefits only business. Add to that the war our government has declaired on the middle class thru outsourcing of jobs, NAFTA, CAFTA and many other int'l trade treaties unfair to the American worker. The looting of pension funds and cancelation of medical benefits of retirees, unaffordable housing (both sales and rentals) unaffordable health care, poor care for our veterans, falling wages, the budget deficit, the trade deficit, the national debt, There is no money to fix roads and bridges, no money for schools, yet always enough money for corporate welfare, Always enough money for aggresive enforcement of traffic laws with photo equiped intersections, radar trailers, and always new police cars and motorcycles. The disparity of taxes between rich and poor due to 3 decades of deregulation with corporate munipulation of government leading to favorable laws, rules, judgements, interputations and decisions. High unemployment, high fuel and energy costs, raising food costs, rampant inflation, falling value of the US dollar, bankrupt of financially threatened state and local governments, abusive customer service by corporate America, big business lobbyst AKA legalized bribery of government officals, abusive use of imminant domain, a revolving door criminal justice system, and a government that shows utter contempt for the lower working class. Yet it would seen the only solution our government sees necessary is to bail out the billionaires, banks, corporations, and financial institutions that have caused this. As if unemployed people are lining up for car loans and homeless people are applying for home purchases.

Comments for this article are closed.

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