Friday, March 2, 2007

The Land of Opportunity

It was reported last week that the income gap in the United States is the worst that it has been in the past 32 years. The US has the most unequal income distribution of all of the developed nations in the world. To put it in perspective there is less income disparity between the rich and poor in India than in the United States.

A large reason for the disparity is that corporations have managed to circumvent traditional compensation through wages by distributing income through profits.

Consider the philosophy of two unions just after the turn of the 20th century:

The American Federation of Labor sought "a fair days wage for a day's work".

While the International Workers of the World sought "to abolish the wage system" in that the workers created the wealth, so they should reap the profits.

Well, the wage system if not stagnant is at least dying in this country, but definitely not in the manner that the IWW had hoped. The 1990s were allegedly the great technology boom in the United States, but even so wages did not grow for workers when adjusted for inflation. On the other hand, corporate profits rose 93% and CEO pay rose 571%. This has happened largely because since 1947 Congress has passed laws to strengthen corporate profits and weaken the union movement in this country. Consider that " the portion of federal revenue derived from corporate income tax has decreased from 33% in the 1950s to 11.9% in 2005, reaching a low of 7.4% in 2003. Eighty-two of our largest corporations paid no tax in at least one of the first three years of the Bush administration."

The lack of quality wages and a viable workers' movement resulting in high levels of poverty have had a profound effect as United States has the highest poverty or near-poverty levels for children, individual adults and familiesamong thirty-one developed nations. Only Mexico and Russia spend less of a percentage of their gross domestic product on social welfare programs than the United States. This is probably why the US is dead last among developed nations in children's health.

Hopefully, these factors will be on people's minds when they go to vote in 2008 rather than worrying about terrorists.

Edit: As an addendum to this post, please read ManfromMiddletown's post on Kos. He writes about the Employee Free Choice Act and its hope for an effect on unions in this country. A fact about Indiana: In 1964, 40 percent of workers here were in unions and today it is only 12.5 %.

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3 Comments:

Blogger Thomas said...

Great post.

"Only Mexico and Russia spend less of a percentage of their gross domestic product on social welfare programs than the United States. This is probably why the US is dead last among developed nations in children's health."

I had no idea we were so low on that list. Sort of puts the right's complaining about the "welfare state" into perspective.

If you ever want to crosspost this stuff at Blue Indiana I would be glad to frontpage this work. Excellent stuff.

March 02, 2007  
Blogger torporindy said...

Thanks, Thomas. I have been meaning to register a diary on your site.

March 02, 2007  
Blogger Timmy said...

eye opening, but not surprising.

March 02, 2007  

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