Khosrovian 1

Derik Khosrovian
Prof. Ogbara
English 101
November 11, 2015
The Wealth Gap
Money. Power. Greed. The United States of America is built upon the idea of the
American dream, which is the concept of becoming wealthy through hard work and
determination. With the American dream comes the democratic government system which is
based upon government officials elected by the people for the people; however, the government
cannot interfere with the amount of wealth one can acquire. Over the past century the problem of
wealth distribution and how money is divided in the country has gotten completely out of hand
leaving the top 1% with most of the countrys money. The wealth gap is a growing problem in
our developing society that could be detrimental if left untreated. If this problem is not solved it
will eventually lead to more citizens becoming poor or even homeless, and could put too much
power of our nation into the hands of only a select few.
Wealth inequality has been a growing problem in America for some time now. Over the
course of time the United States has had its up and its downs, but the more serious issue is how
the population of the poor is increasing and the rich is decreasing. In the article Increasing
inequality of wealth by John C. Weicher, he states how between the time period of 1983 to 1989
the poor index doubles and the distribution of wealth became more unequal (Weicher 21). The
author is showing that during a time in the countrys history, the stock market had a big boom
and wealth inequality became worse. He explains more of the problem by saying how the rich

Khosrovian 2
owned most of the stocks; therefore, they became richer, but left the poor to get poorer. This
would cause havoc in society causing the lower class to grow rapidly and benefiting the wealthy
immensely. Who are the rich exactly? The wealthy class is known today to be the celebritys,
singers, and company CEOs. To be in the richest 1 percent of U.S. households, families had to
have $2 million in net worth in 1983 and $2.3 million in 1983 (Weicher 22). This would equal
to about $4.7 million in todays money, whereas the average household net worth today is far
from that. If this inequality continues, the 1% will continue to live luxuriously, leaving everyone
else to struggle.
To have wealth is to be well off in life. Being well off means not living paycheck to
paycheck and having a substantial amount of surplus money in the bank. The big difference in
the financial status of many Americans does not allow everyone to have that luxury. In the
interview with Edward Wolff, who is an economics professor, titled The Wealth Divide he
states Wealth strictly financial savings provides security to individuals in the event of
sickness, job loss or marital separation (Wolff 11). Wolff is saying that surplus wealth is needed
as insurance in case of an emergency. With the difference in wealth in the U.S only a handful of
Americans actually have that luxury to rely on just in case something happens. When the average
American has a catastrophic event, they struggle whilst the rich can just write a check and
continue on with their daily lives. There are also a handful of Americans that cannot even afford
the basic necessities of life. Wolff points out that about 20 percent of Americans have either no
money or their debt is about the same as what they have (Wolff 12). The author is saying how a
big percentage of Americans have nothing. With more people every year entering poverty the
amount of power the wealthy are acquiring is putting them in charge. In todays world most
Americans are often demotivated by the difference in powers and wealth. In an article by

Khosrovian 3
Alexander Eichler published by the Huffington Post titled, Three-Fourths Of Americans Say
The Rich Have Too Much Power was a survey that resulted in many Americans believing that
with the weak economy and the amount of power the rich have, the idea of pulling yourself up
by your bootstraps is becoming harder to believe in (Eichler 1). This survey conducted shows
how many Americans feel that there is an unequal balance in powers and start to doubt their
abilitys. With the doubt people are accumulating, the wealth gap could lead to more poverty and
more power in the hands of the wealthy.
Very minor and controlled wealth inequality in nation is good for the overall growth of
the country. The democratic system adopted by the U.S is a basic concept of building ones own
fortune and empire. With that idea comes with the inevitable fact of wealth inequality. In the
article Why wealth inequality isnt a bad thing the author Jim Iuorio states An economy that
has no wealth inequality will, most certainly, stagnate and die leaving widespread poverty
behind (Iuorio 1). The author is emphasizing that wealth inequality is needed to the
advancement of society and without it comes horrible side effects. I agree wealth inequality is
needed, but wealth inequality that leaves almost 60 million Americans in poverty or unemployed
is not the answer (Eichler 1). The inequality in the distribution of wealth is a problem that does
not have a simple answer. The rich want to keep and grow their fortune because Americans no
matter how well or poor they do are entitled to the income that they earned. In the novel The
Gospel of Wealth Andrew Carnegie states the right of the laborer to his hundred dollars in the
savings-bank, and equally the legal right of the millionaire to his millions (Carnegie 488). The
author is saying that although there is an inequality of wealth, everyone has the right to keep the
money they earned. This idea leads back to the fact that the laborers who work for the wealthy
will continue this cycle, plateauing their possibility of every building any kind of fortune. This

Khosrovian 4
lead society into a bad position of how much wealth inequality is healthy for society, and is there
a solution to get us there?
There are many ways in which the inequality of wealth can either be downsized or the
wealth of the poor can increase. A democratic society is a type where benefits like healthcare and
education is purchased and not given by the government, but could providing these benefits help
the poor financially? In the article The Real Solution to Wealth Inequality. Mike Konczal and
Bryce Covert argue that public programs such has free healthcare and education help society
directly with wealth instead of taking a risk and hoping to help the poor save up money to afford
both (Konczal and Covert 3). The authors are emphasizing how providing the public with these
programs could aid them in gaining financial stability. If necessities like healthcare and
education were paid for by the government people would not have to worry about the additional
cost of these programs. This could be a very plausible solution because in 2015 programs like
healthcare are mandatory people who do not have it will be fined. With these programs provided
and a fine not imposed, this could widely benefit every American by taking out one extra
payment. With this idea the wealthy could also distribute their surplus wealth by leaving it for
public purposes (Carnegie 489). Carnegies idea behind this theory is that, if the wealth
inequality is inevitable then the wealthy can utilize their surplus money by helping the public
with programs. The knowledge people would gather from these programs such as libraries could
give them the help of creating financial stability.
The current tax system in place for the U.S is very well at taxing, but leaves families with
very low income to suffer. When a family earns an income they are taxed, regardless of how
much they make or their financial status. If the families that do not have the luxury of surplus

Khosrovian 5
wealth could be exempt from taxes it could lead them into economic stability. Wolff explains his
take on a Swiss like taxation system. In the United States, the first $250,000 of wealth would be
exempt from the tax. That would exclude 80 percent of all families, he then further explains that
as the wealth of the families increase the amount they are taxed increases as well (Wolff 15). The
author is showing a system of taxation that he believes to be fair. Whereas the wealth of a family
increases, the taxes increases as well. I believe this to be a fair system as well because excluding
the classes under a certain amount of wealth could help them maintain a lifestyle and not fall
under debt with a possibility of poverty. Furthermore, more tax depending on the wealth will
keep the economic gap at a safe level not allowing the wealthy to be in total control. This
ideology could provide a very plausible solution to the big problem in wealth the United States is
facing today.
The inevitable problem of the wealth gap is something Americans can never escape, but
there are ways to prevent this problem from getting worse than it already is. Although a healthy
wealth gap is necessary for advancement in society, the inequality in wealth is growing yearly
and could be detrimental. If left untreated it could potentially lead to more poverty in the U.S and
more power left in the hands of the wealthy. There are three ways in which this problem could be
treated. The first option would be to provide free public programs like health care and education
to take some financial stress of the familys income. A second potential option would be for the
wealthy to disperse their surplus money into programs to educate the public to gain financial
stability. Lastly and the most viable option would be taxation based on wealth. This idea will let
exclude families under a certain incomes from taxes and will tax the rich depending on how
wealthy they are. The state of the United States at this point in time is at a very fragile state
because the percentage of poverty is rising and percentage of wealth within the top 1% is

Khosrovian 6
increasing. With that being said, if this cycle continues it could evidently create a very unequal
world with a small percentage of the country living lavishly and a big percentage of the country
barely making ends meet. If left untreated disaster is imminent.

Khosrovian 7

Works Cited
Carnegie, Andrew. The Gospel of Wealth. A World of Ideas. Ed. Lee A. Jacobs. New York:
Bedford, 2013. 350-360. Print.
Eichler, Alexander. Three-Fourths Of Americans Say The Rich Have Too Much Power: Poll.
The Huffington Post. Huff Post., 15 Dec. 2011. Web. 4 Nov. 2015.
Konczal, Mike, and Bryce Covert. The Real Solution to Wealth Inequality. The Nation.
TheNation.com., 30 July 2014. Web. 4 Nov. 2015.
Luorio, Jim. Why Wealth Inequality Isnt A Bad Thing CNBC. CNBC.com., 15 June 2015.
Web. 4 Nov. 2015.
Weicher, John C. "Increasing Inequality of Wealth?" Public Interest.126 (1997): 15

Khosrovian 8
25. ProQuest. Web. 29 Nov. 2015.
Yunker, James A. "Capital Wealth Inequality and Public Bads: A Mathematical
Analysis." Eastern Economic Journal 29.1 (2003): 105-19. ProQuest. Web. 29 Nov.
2015.