Inequality for All

Robert Reich’s documentary “Inequality for All” is an analysis of wealth disparity in the United States. Reich has demonstrated how the rich have continued to get richer while the poor get poorer. The wealth of the nation is concentrated on a few rich people while the majority middle income and lower class people struggle to make ends meet.

One of the major causes of this inequality is the development in technology. With globalization, workers are replaced with machines creating high efficiency which translates to higher productivity. While the middle income earners lose their jobs due to automation, the rich earn more due to increased productivity that comes with efficiency. Part of the wages that would have gone to paying the workers is now translated as profits and the rich get richer. As Reich says, the above 400 richest people in America have more wealth than the lower 150 million people. Since the year 1978, the income earned by the poor has considerable decreased as the income earned by the rich increase.

Another major problem is that wages are determined by the labor market. The demand and supply of labor in the market determines the wages. It can be said that education is now more accessible with the financial services such as student loans. So the wages in the labor market do not grow. The supply of workers increase as the job opportunities decrease with the development in technology. However, the living condition increases everyday. The price of foodstuffs has increased considerably from the years 1978 but wages have stagnated in many instances has reduced relatively. The rich however are the owners of the factors of production and thus make more money.

I can agree with Reich that the income share of the minority rich peaked in 1928 and 2008 leading to a market clash. The major cause of the market collapse in 2008 was increase in subprime mortgages. These are mortgages that targeted borrowers with less-than-adequate savings and less-than-perfect credit. The borrowers were considered high risk thus; the loans had high-interest rates and variable payments. However, when these borrowers were unable to clear their mortgages, the blenders stepped in and made them homeless.

The higher the home prices went, the lenders got creative in maintaining the pace disregarding the consequences. This lending was not done by the poor rather by the rich. When the home prices decreased to an extent that the outstanding balance was more than the home value, most of the people lost their homes but the lenders relatively did not lose due to the high interest rates charged. The inequality existing in America is now a problem and it is upon the society members to fight against this inequality.

If this problem is ignored at this level, it will escalate to greater height in future. One way to fight this inequality is for the government to ensure that the economy reaches the full employment. The private sector is the largest employer and when it does not reach full employment; the government should correct the deficit. In addition, when the economy is below the capacity, the government should initiate fiscal and monetary policies to ensure productivity. I think that the minimum wage level should also be increased. This will force the private sector to increase wages which have remained constant for some time.


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