Discuss the distribution of wealth in America and explain how it negatively affects minority populations from the sociologist perspective.
Wealth distribution or income inequality can be examined from two perspectives. The first is the accumulation of wealth transferred to the next generation. The second is consumer spending and the effects on the national economy.
Wealth inequality is not just an American problem. It is a global problem with implications that extend beyond the boundaries of the United States. However, because the United States is the best representative of a capitalist economy, has the highest GDP in the world, and is one of three countries that drive global economics, the problem of wealth inequality is especially problematic in American society. Wealth inequality specifically impacts minorities disproportionately in several critical economic and quality of life matters.
There are two ways sociologists, economists, and political scientists look at wealth inequality. The first is the lack of economic opportunity or economic mobility resulting from extremes in wealth. One phenomenon, sometimes referred to as the Great Gatsby Curve, involves the transfer of wealth from one generation to the next. Wealth comes in several forms other than money. Property, businesses, investment, and other non-cash assets make up a portfolio of wealth. In the United States, a substantial portion of personal wealth is in property ownership.
While there is contradictory data about the rate of homeownership by minorities, there is less contradiction in the dollar value of properties owned by minorities than non-minorities. The value of property held by minorities is substantially less. The result is far less capital transfers to the next generation that can be used for education, job relocation, investment in a business, or retirement. The wealth gap diminishes the notion of economic mobility, social class mobility, and economic benefits that go with upward mobility.
One way to think of wealth inequality is the opposite of the accumulation of assets. The second way is to look at consumption or consumer spending. Economists point to the trends that indicate that overall, in the United States, wages have shown steady increases, including income levels in the minority communities. However, the rise in income of minority communities has not been nearly that of the non-minority communities. There are several sociological factors for slow growth.
Gaps in education, poor transportation, limited affordable housing, globalization, limited access to technology, and government policies have all played a role in limiting the amount of income growth in minority communities. Having less income results in a more significant share going to housing, utilities, food, and transportation. The result is less disposable income, which impacts the national economy negatively. Having less monthly income also reduces the amount that can be saved for emergencies, investments, retirement, or to pay for education.
Several other negative ramifications are resulting from the distribution of wealth and income inequality in the United States. These include lack of political power, systemic racism, crumbling infrastructure in cities, lack of healthcare, and a rise in homelessness. Wealth distribution touches nearly all aspects of American life.
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