Answer :
Final answer:
Economic inequality arises from the concentration of wealth among the top 1%, impacting social mobility and exacerbating poverty. Historical union membership rates have decreased, while coping mechanisms of the middle class include working multiple jobs and relying on debt. Furthermore, taxation discrepancies highlight the systemic challenges in achieving fairness and equality in society.
Explanation:
Economic Inequality and its Implications
The questions surrounding economic inequality reveal significant issues within society. Economic inequality is often discussed regarding the concentration of wealth among the top 1%. Recent studies indicate this elite group has amassed over 30% of the nation's wealth, which raises concerns about social mobility and fairness.
People are upset primarily because this concentration of wealth creates systemic advantages for the wealthy, while hindering opportunities for the lower and middle classes. The top 1% generally acquire their wealth through various means, including investments, business ownership, and favorable tax policies which further exacerbate inequality.
Understanding the Impact
In the 1950s, union membership peaked at around 35% in the U.S., illustrating a historical effort to combat inequality, but has since declined, impacting workers' bargaining power. Furthermore, research suggests approximately 42% of children born into poverty remain impoverished as adults, underlining the difficulty of escaping this cycle.
To cope with inequality, the middle class often resorts to three primary mechanisms: working multiple jobs, incurring debt to maintain lifestyles, and relying on social support systems. Reich highlights that concentrated wealth leads to reduced economic mobility, undermining democracy and creating greater divides in society.
Taxation and Economic Disparities
As for taxation, the average American pays about 14% of their income in federal taxes, while high-profile individuals like Mitt Romney and Warren Buffet have been criticized for paying much lower effective rates, around 13% and 15% respectively, due to loopholes and capital gains taxation. This disparity further underscores the challenges of equality in the U.S.
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