Policies Addressing Social Inequalities

Introduction

Inequality is a serious issue often overlooked but has been on the rise globally for years. Due to the issue of social inequality countries around the world have created initiatives and programs aimed at reducing the number of people living in extreme poverty. Yet and still economic gaps continue to grow as the rich get richer and the poor get poorer. Among industrial nations, the United States is considered top heavy with greater shares of wealth and income constantly increasing for the richest 1 percent than any other country (Institute for Policy Studies, 2019).

Example of social inequality both in the U.S. and worldwide.

Social inequality refers to the uneven distribution of resources in a given society. In a society where social inequalities exists the access of social goods are influenced by variables such as power, religion, kinship, prestige, race, ethnicity, gender, age, sexual orientation, and class (Institute for Policy Studies, 2019) . This can include things like the labor market, source of income, total income , health care, freedom of speech, education, political representation, and participation.

(Institute for Policy Studies, 2019). As mentioned earlier social inequality is linked to an unequal distribution of income or wealth, which is frequently studied as a global issue. The social inequality of income distribution is reflected in the US and other countries worldwide. In the United States, the income gap between the rich and other members of society has been growing remarkably over the past 30 years. (Institute for Policy Studies, 2019) . In the six years of 2000 through 2006 the number of Americans living in poverty increased 15 percent.

(Amadeo, 2019). By the year 2006, almost 33 million employees in the workforce earned less than $10 per hour with an annual income of less than $20,614(Amadeo, 2019). This annual income level is below the poverty level estimated for a family of four (Amadeo, 2019). In the wealthiest 1 percent of households during the years 1979 and 2007, household income increased 275 percent. (Amadeo, 2019) Income rose 65 percent for the top inversely the bottom fifth only increased 18 percent. (Institute for Policy Studies, 2019). These statistics are relevant even after wealth redistribution minus all taxes and adding income from Social Security, welfare, and other payments.

When examining income inequality looking at countries like China, economic growth over a period of time has lifted millions out of poverty. As a result, there has been a noticeable decline in the poverty ratio. However, the rapid economic growth has not been beneficial to the population causing an increase in income inequality (Sonali et al ., 2018). This issue of income inequality concerns nation as literature has documented elevated levels of inequality as being harmful to society. Income inequality adversely affects health and education, and has a negative effect on growth. It has been known since 1990 that china was a slightly unequal country but now has become one of the most unequal countries similar to the United States (Sonali et al ., 2018). Income inequality in China presently is measured by a value known as the Gini coefficient and by this measure the rates of inequalities in the nation are among the highest in the world. In 2013 the Standardized World Income Inequality Database (SWIID) calculated the Net Gini coefficient at 50 points. (Solt, 2016).This coefficient is above regional averages and among the highest in Asia. The National Bureau of Statistics (NBS) estimated the coefficient to be slightly lower at 47.3. (National Bureau of Statistics [NBS], 2013). Furthermore, the Gini coefficient has rapidly increased in the past years by about 15 Gini points (NBS, 2013). The Gini measure tends to be very consistent over time and is a considerable rise in inequality.

Comparison of policies that address that social inequality in the U.S. and other countries

In the United States of America the government has put programs in place aimed at income inequalities. The Temporary Assistance for Needy Families (TANF) program is a federal assistance program commonly known to citizens as welfare. The program was initiated July 1, 1997 as a substitute for Aid to Families with Dependent Children (AFDC) a program which provided cash assistance to families via the department of health and human services. TANF also provides cash benefits dependent upon the family’s incomes and one must meet a strict set of requirements to be eligible.(Administration of Children and Families, 2019). The government also has inactivates aimed at income redistribution based on taxation. A progressive tax provides for a higher rate on the wealthy than on the poor. Families in poverty spend a large portion of income on living expenses. So because of this known fact, all of their income is needed for shelter and other necessities. A tax decreases their ability to afford a decent standard of living by subtracting from their income. In a progressive tax system the wealthy pay more tax than the poor (Lee, 2002). An additional common type of redistribution of income by the federal government is the Supplemental Nutrition Assistance Program (SNAP). Federal programs such as SNAP are funded through general taxation and benefit the poor by providing cash benefits for the purchase of healthy food (United States Department of Agriculture, 2019).

Similar to the United States China suffers as well with issues of inequalities and has enacted policies to reduce the effects of the issue of inequality. As a way to prevent income inequality, the Chinese government enacted personal tax reform. As a result of this tax reform the minimum amount of personal income tax was increased in the amount of 800 yuan per month to 3,500 yuan per month in the year 2011. (Sonali et al ., 2018)This reform remains in place year to date and is estimated at 78 percent of GDP per capital (Somali et al ., 2018)The nation has also made notable changes to the labor market . In the year 2009, a large scale protest from over 10,000 employees of a popular shoe factory caused an annual increase in the minimum wage. As a result of the protest by the year 2015 the average ratio of minimum wage compared to average wage increased by 31.2 percent for non-private sectors and 51.2 percent in the private sectors( China Labor Bulletin, 2019) The country also has a social security program similar to the United States.A total of 378 million Chinese citizens participated in the Chinese workers participated in program for the year 2016. (China Labor Bulletin, 2019). In addition, 508 million citizens participated in the basic pension program offered to both urban and rural employees in the nation (China Labor Bulletin, 2019).

Polices success in the U.S. as compared to other counties in reducing the social inequality

As stated earlier the United States has put into play policies and initiatives aimed at reducing income inequalities such as poverty. The United States social security program lifts more Americans above the poverty line than any other federal program. Without Social Security, it is estimated that 22.1 million more Americans would be poor (Center for Budget and Private Policy , 2015). Although Social Security is aimed more towards keeping the elderly out of poverty, a total of 6.7 million citizens who revive SSI benefits are under age 65. (Center for budget and private policy, 2015). It is estimated that 1.1 million recipients are children. Social Security is especially beneficial to certain groups such as elderly women and people of color, who would normally have limited to no income outside of Social Security. (Center for Budget and Private Policy, 2015).

What are some of the limitations of current policies in the U.S. vs. other countries? Use scholarly research to support your discussion.

Although the US has put into place many policies to circumvent the issues of inequalities and aimed to reduce poverty, it still exists. These mediocre federal programs are not enough and do not take into account the entire population. There are strict rules and regulations governing assistance and oftentimes people who need the assistance are not eligible. A recent review of TANF renewals showed that for every 100 families living in poverty, 10 or fewer receive TANF cash assistance(Center for Budget and Private Policy, 2015).

References

1. Administration for Children and Families .(2019). Retrieved From https://www.acf.hhs.gov/ofa/programs/tanf
2. Amadeo.(2019) . Income inequality in America . Retrieved From https://www.thebalance.com/income-inequality-in-america-3306190
3. Center for Budget and Private Policy.(2015). Social Security Lifts More Americans Above Poverty Than Any Other Program. Retrieved From https://www.cbpp.org/research/social-security/social-security-lifts-more-americans-above-poverty-than-any-other-program
4. China Labor Bulletin.(2019). China’s social security system. Retrieved From https://clb.org.hk/content/china’s-social-security-system
5. Institute for Policy Studies. (2019) . Inequality. Retrieved From https://inequality.org
6. Lee., D.R.(2002). Redistribution of Income. Retrieved From https://www.econlib.org/library/Enc1/RedistributionofIncome.html
7. National Bureau of Statistics . (2013). China annual data . Retrieved From http://www.stats.gov.cn/english/Statisticaldata/AnnualData/
8. Solt, F., (2009) .Standardizing the World Income Inequality Database. Social Science Quarterly, 90(2), pp.231–42.
9. Sonali J.C., Khor, N.,Mano R., Wingender.,P.,Zhuang Z.(2018)Inequality in China – Trends, Drivers and Policy Remedies. Retrieved From https://www.imf.org/~/media/Files/Publications/WP/2018/wp18127.ashx
10. United States Department of Agriculture. (2019). Supplemental Nutrition Assistance Program (SNAP). Retrieved From https://www.fns.usda.gov/snap/supplemental-nutrition-assistance-program