Inequality and Poverty

Inequality and poverty are the most urgent social problems at the present day. In fact, the inequality is increasing substantially in all the countries around the world. It has grown so high that it threatens the economy, laws of equal opportunity and coherence of a society. All countries employ different strategies to deal with inequality. The United States have always employed the three coping mechanisms in response to declining wages. These refer to bringing more women to the national workforce, increasing working hours and transforming ones’ houses into the “piggybanks” through home equity loans. The problem is that all coping mechanisms are no longer efficient as they prevent the economy from growing. In his lecture on the politics and economics of inequality, Professor Robert Reich clarifies the far-reaching consequences of a degrading economy and offers his solutions to struggle with poverty in the United States.

Dr. Reich’s view of poverty is a bit different from the common opinion. The majority of people think that wealth inequality is the most serious social problem in the United States. Nevertheless, Dr. Reich believes that some amount of inequality is inexplicable and even necessary to keep the economy moving. Accordingly, he considers an income inequality a more serious problem than wealth inequality. Furthermore, the former gives a rise to the latter. Even more, the situation with poverty is worse in the United States comparing to other countries. According to Dr. Reich, 42% of American children born in poverty will never get out of it in comparison to only 30% in England (Reich, 2014). That is the highest percentage comparing to other industrial countries. It means that U.S. fails to help poor people ascend into the middle-class and does not increase the purchasing power of its citizens in general.

Robert Reich explains the current levels of poverty in the United States with three reasons. The first cause of the poverty is the dysfunctional economy. Current U.S. economy cannot function properly and it does not grow despite all the expectations. In particular, the economic growth was no more than 2% last year. When 70% of economy depends on consumer spending while people do not have adequate wages, it leads to a collapse of the economy (Reich, 2014). Under such conditions, the middle-class and the poor lose their purchasing power. Thus, the economy cannot flourish anymore. The second cause of poverty is the elongation of the social ladders. To put it straight, there are no more ladders in the middle class. While so many people believe in the American dream, ideals of upward mobility and equal opportunity, the realm is different. Today, it takes much more time and effort to move to the next level of a social ladder than it was in the past. Thus, people may work hard their whole lives and not become richer at all. The middle-class of America is a small layer of a society nowadays. Moreover, it has two negative consequences for people. First, if there is no middle-class the poor cannot ascend into it. Second, the middle class is scared and insecure, so it does not want to help the poor. Thus, a vicious circle emerges that persists poverty. The third cause of poverty is politics. The middle-class is angry, frustrated and economically insecure. Thus, these people tend to blame others for their misfortune. That is the basis of the politics of resentment. Politicians rely on the feelings of their electorate to manipulate them. Thus, the right wing blames the left wing for a dysfunctional economy and vice versa. As long as people blame each other, they do not search for solutions. That is the reason why poverty persistence in the U.S. is a more serious problem than in other modernized nations.

Luckily, there are some solutions for overcoming the poverty in the United States. The successful strategy of dealing with the problem should consist of three steps. The first step would be improving the system of education. According to Robert Reich, this country has to provide the best education in the world. College degree in liberal arts should not be the only way of access to the middle class. In particular, the United States should imitate Germany’s excellent system of technical education. The next step would be an alteration of the tax system. Great system of education and excellent infrastructure are the first preconditions necessary to overcome poverty. Another step would be constraining the Wall Street, which means limiting the size of the biggest banks. The Wall Street determines the rules of the world economy and imposes a huge economic burden on the members of American society. There is too much control over the economy in the hands of a small group of people. Therefore, the solution must aim at equal distribution of wealth among the Americans. Besides, Dr. Reich suggests, “getting big money out of politics because we’ve got to make our democracy work” (Reich, 2014). Politicians claim that they do everything they can to fight the poverty, but in reality, they change nothing. People should engage and start exerting power over politicians more often in order to fight their cynicism. According to Professor Robert Reich, these steps would contribute to fighting the poverty and formation of the good society.

In my opinion, Professor Robert Reich has grasped the essence of the poverty in the United States. A culture of blame does exist in the American society. To add even more, this idea covers more than we think. People blame politicians for their misery, while women and racial minorities blame society for biases and prejudiced attitudes toward them. Sexual minorities blame the law enforcement institutions for not granting them the same rights that others have. Thus, the culture of the United States of America is permeated with blame and its following consequences. Meanwhile, when people do nothing but complain and blame each other, they do nothing for the improvement of a situation. As long as people accuse each other of poverty, it will persist.