Wealth inequality is as extreme today as it was during the Great Depression years. In real terms, the wealthy hold the majority of this nation’s wealth and income. The problem in this country is mass disillusionment. In a recent study by Duke and Harvard University they found many Americans believe that the top 20% of our nation’s wealthiest own 60% of the wealth. The real figure is the top 20% own 84% of our nation’s wealth and it is increasing every year.
When the respondents were asked to pick an unlabeled pie chart “How much should the top 20% own?” 92% of them preferred the Swedish model of income distribution over the current American economic model. The Swedish economic model, which is the top 20% own 36% of the nation’s wealth.
Americans Prefer Sweden
For the first task, we created three unlabeled pie charts of wealth distributions, one of which depicted a perfectly equal distribution of wealth.
Unbeknownst to respondents, a second distribution reflected the wealth distribution in the United States; in order to create a distribution with a level of inequality that clearly fell in between these two charts, we constructed a third pie chart from the income distribution of Sweden
We presented respondents with the three pair-wise combinations of these pie
charts (in random order) and asked them to choose which nation they would rather join
given a “Rawls constraint” for determining a just society (Rawls, 1971):
“In considering this question, imagine that if you joined this nation, you would be randomly assigned to a place in the distribution, so you could end up anywhere in this distribution, from the very richest to the very poorest.”
As can be seen in Figure 1, the (unlabeled) United States distribution was far less
desirable than both the (unlabeled) Sweden distribution and the equal distribution, with
some 92% of Americans preferring the Sweden distribution to the United States.
In addition, this overwhelming preference for the Sweden distribution over the United States distribution was robust across gender (Females: 92.7%; Males: 90.6%), preferred
candidate in the 2004 election (Bush Voters: 90.2%; Kerry Voters: 93.5%) and income
(less than $50,000: 92.1%; $50,001-100,000: 91.7%; more than $100,000: 89.1%).
In addition, there was a slight preference for the distribution that resembled Sweden relative to the equal distribution, suggesting that Americans prefer some inequality to perfect equality, but not to the degree currently present in the United States.
92% of the respondents believe in the socialistic economic wealth distribution of Sweden. Unfortunately, Americans have been persuaded to vote for these regressive Republicans for the last thirty years who favor this income inequality. In Sweden the top income tax rate is 56%, which is far lower than the American tax rate of the 1950s.
This current Republican Great Recession has started to open the eyes of many Americans. These Americans that have bought into a failed economic policy of trickle down economics and crony capitalism and now realize the error of their ways, including Alan Greenspan.
Look around the country and you will see town hall meetings in predominately conservative districts erupt in anger over the possible implementation of a Medicare Voucher system.
The people are getting restless, the jobs are scarce and the jobs that are available pay lower wages than before due to a higher supply of labor in the market. Instead of focusing on jobs, the current crop of Republicans in Washington D.C. would rather focus on cutting programs that are keeping real Americans afloat during this Republican Recession. They would rather defend the Defense of Marriage Act and curb abortion right for women.
The Republicans are using this past election as an avenue to further a political ideological agenda rather than move this country toward a more prosperous future.