As Italian, when I first moved to Los Angeles, it was not difficult to realize how much this city was driven on one hand by a great innovation, on the other hand by a very huge inequality. After living here for few days, it was easy for me to having a better sense of the social status of the people living in LA. Basically, you might trace a horizontal line that divides the city between north and south: norther you go, richer the people and neighborhoods you encounter, while southern you go the poorer are the people you encounter. Maybe this could sound a very approximate and stereotyped frame, but nobody can deny that, for someone you just move in LA, the impact with inequality is very strong: too many homeless people living alone in terrible situations along the streets, under the bridges, or in the tents – when they happen to be “lucky”. When I experienced this situation for the first time, honestly my first question was: how is a situation like this be possible in a rich and forward-thinking country as the United States? Yet, after few months living here I realized that, according to the current U.S. economy, unfortunately, it is totally possible. The United States is one of the most unequal country in the world (OECD Income Distribution Database).
According to an article published last week by the New York Times, U.S. elite professionals earn 3.5 times more than the typical (median) worker in all occupations. Its income inequality is testified by the Gini coefficient that, according to the United States Census Bureau, for the 2016 was 0.481. Such a huge different is overcame only by other two countries in the world: Israel and Mexico.
Additionally, when I looked at the NTY chart that refers to the analysis extracted from the World Income Database, I realized that even Italy (my home country) is much less unequal than the United States, where over the last year only the 1 percent’s share of national income has experienced a sharp growth: this information has really blown my mind, because before moving to the U.S. I believed that Italy was one of the worse country for what concerns inequality, because its rate has been rising without control. Actually, it is not.
What it’s really going on in the U.S.? Mr. Trump is taking advantage of the argument on increasing inequality spreading along the country, stating that the main causes of the rising poverty rate have to be referred to: the evil nations oversea, like China, that are responsible for unfair trade negotiations and stealing jobs to U.S. workers, or to the immigrants, who also steal jobs from U.S. workers. Conversely, others believe that the cause of this situation relies on the switch of the type of experts needed in the work place. The number of people employed in the information technology industry is still too tiny, and it has not been contributing to the rise of the average incomes.
Yet, one of the main reason, as the NYT states correctly, is connected to the fact that since 1980 all the norms, both legal or economical, have been shaped by the upper middle class. This factor has led the richer people increasing their influence in the political life so that they could execute their power on the economy, reforming and reshaping the norms according to their interests.
This issue inevitably refers to the recent, and debated, tax plan overhaul, that it does not seem helping to decrease inequality in the country.
As a result, as is shown in this interesting visualization, between 1980 and 2014 the largest income growth has been registered only by the 99.999th percentile, a growth that will keep rising making richer people even more rich.