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Is income inequality a harmful phenomenon?

Debate Information

In capitalism, it is natural for there to be very wealthy individuals at the top, and those who struggle below. From what I have heard the "wealth gap" means that the very rich suppress the poor, but I've also heard that the rich create a standard for the lower classes to look up to, therefore generating more wealth and progress as a motive.

I am genuinely curious about this since I have always wondered why income inequality is necessarily bad. All perspectives welcome.
holoetherepnorthsouthkoreajoecavalrycheesycheese
  1. Live Poll

    Is income inequality harmful?

    25 votes
    1. Yes
      24.00%
    2. no
      76.00%
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    Arguments


  • holoeholoe 6 Pts   -  
    No, people who work hard deserve more, that includes money.
    SaltyDogjoecavalryApplesaucecheesycheeseZombieguy1987
  • SaltyDogSaltyDog 21 Pts   -  
    generally when the people at the top do better the lower tiers do better as well.

    joecavalrycheesycheese
  • agsragsr 881 Pts   -  
    @SaltyDog, good point. There are always exceptions, but generally when upper class does well, middle class does well too.  That raises the entire population.
    in any heathly economy it is okay for super-talented, super-lucky, super-hardworking to have much higher income. Otherwise we would have to say that Bill Gates or Elon Musk would be forced to make as much as an average engineer.  
    In socialist society the income get equalized to be "fair", but that doesn't promote progress and innovation.
    northsouthkoreajoecavalry
    Live Long and Prosper
  • inc4tinc4t 186 Pts   -  
    Harm of Income inequality is communist propoganda.  It is only not harmful, but fuels whats great about America.
    therepjoecavalrycheesycheese
  • thereptherep 61 Pts   -  
    It is not harmful, due to the thinking of working hard and earning much more in comparison to not.
    melanielustjoecavalry
  • OakchairbcOakchairbc 88 Pts   -  
    Economic inequality is a wells studied topic in economics. The literature generally agrees that current inequality is harming economic performance[1][2]. There are many ways inequality can harm economic growth. 
    1- Inequality reduces happiness and happy workers are more productive. 
    2- Inequality reduces trust as those on the bottom begging to view to top as predators. 
    3- Inequality results in more speculative type economic growth due to the rich having all the money instead of consumers[3]. Its not a coincidence that the two periods when inequalities was the highest both had large financial crisis. 
    4- Rich peoples tend to spend money on goods with high mark ups. They want vintage wine made with a hint of diamond and gold flakes.

    [1]https://blogs.imf.org/2017/05/11/a-new-twist-in-the-link-between-inequality-and-economic-development/
    [2]http://economistsview.typepad.com/economistsview/2015/03/how-inequality-harms-health-and-the-economy.html
    [3]http://www.imf.org/external/pubs/ft/fandd/2011/09/Berg.htm

    northsouthkoreajoecavalry
  • northsouthkoreanorthsouthkorea 221 Pts   -  
    @Oakchairbc , I agree with your argument. Income inequality can greatly reduce the staisifaction of workers and possibly decrease  productivity. 
    joecavalry
  • FascismFascism 344 Pts   -  
    Income inequality fuels the economy. However, in some cases it has reached an unacceptable point. Too much inequality is bad too. 
    joecavalrycheesycheese
  • ViceRegentViceRegent 68 Pts   -  
    Income inequality is based on some being better at serving their fellow man than others, encouraging the others to improve themselves and their ability to serve.
    joecavalryDrCerealSilverishGoldNovaZombieguy1987
  • SchnuupiSchnuupi 21 Pts   -  
    Considering it does not exist. People just call anything a wage gap, for example, someone who earns $200,000 a year and someone who earns $20,000 a year would have SJWs calling it a wage gap. But you have to consider that they will have different fields, qualifications, roles, how long have they worked to get there etc.

    The only way you could talk about a wage gap as a harmful situation is if there were 2 people working at mcdonalds. One was earning $350 a week doing a 40 hour week, and the other earns $450 a week doing a 36 hour week. Then clearly something is not equal in their wages. But this does not happen, wages ARE equal it is law and it is standard. People are paid based on age+hours worked. It's all in a system that just pays for what you work. The money system and employers could not care less who's doing the job. As long as the job is getting done.
  • NopeNope 397 Pts   -  
    Schnuupi Why does age matter? Who care about age. I would only care about hours worked, job, experience, and record (Just to make sure they won't still some of the fries). ; )
  • SchnuupiSchnuupi 21 Pts   -  
    Because a 16 year old can not do all of the duties of someone say 21, they may be too dangerous, or they be require responsibilities that require the worker to be over 18. Ages do matter. If an under 16 got paid the same as a 25 year old THAT would be an inequality wage gap. @Nope
  • NopeNope 397 Pts   -  
    Schnuupi How about instead of age it is ability. 
  • SchnuupiSchnuupi 21 Pts   -  
    Again you miss the point. Someone under 18 can work in a Bar but they cannot perform all duties, therefore they get a lower wage. Makes sense. Over 18 you can do more tasks such as serving alcohol. There is a reason for this. It's also to discourage people leaving school at very young ages to work and to encourage them to pursue further and higher education. @Nope
  • ViceRegentViceRegent 68 Pts   -  
    @Schnuupi

    Right, the state needs to stop forcing people into the mold they think best and let people be free.
  • NopeNope 397 Pts   -  
    Schnuupi People under 18 are unable to do some bar jobs because of the law. So it still is part of ability right?
  • VaulkVaulk 813 Pts   -   edited November 2017
    @Oakchairbc

    Firstly: From the following link you should walk away knowing this: "Much has been written about the relationship between inequality and economic development, but theory remains inconclusive". 
    https://blogs.imf.org/2017/05/11/a-new-twist-in-the-link-between-inequality-and-economic-development/

    The entirety of this blog post is based upon this solid acknowledgement from the author.

    Second: In your second reference below, the author again states clearly that the theories regarding income inequality and economic development are inconclusive as there is uncertainty of how it happens.
    http://economistsview.typepad.com/economistsview/2015/03/how-inequality-harms-health-and-the-economy.html

    This one did a little better though, offering that there is suggestive evidence to support the relationship.

    Lastly, your third reference is pretty good.  The end of the article is summarized by the author by stating that while there's evidence to suggest that income inequality is negatively affecting growth...there's no known way to correct it in regards to policy.  The author acknowledges further that attempting to correct income inequality through policy has already been attempted in China and resulted in further inequality for the lowest financial class of citizens.
    http://www.imf.org/external/pubs/ft/fandd/2011/09/Berg.htm

    1. If you're unhappy because someone makes more money than you do in the United States...then you're unhappy about your circumstances, not someone else's.
    2. If you're distrustful of those at the upper bracket of finances simply because they make more money than you...that's called "Being petty".
    3. Speculating wildly about what rich people want and how they spend their money is entertaining but none-the-less unproductive.


    "If there's no such thing as a question then what kind of questions do people ask"?

    "There's going to be a special place in Hell for people who spread lies through the veil of logical fallacies disguised as rational argument".

    "Oh, you don't like my sarcasm?  Well I don't much appreciate your stup!d".


  • NopeNope 397 Pts   -  
    Schnuupi I mean ability in terms of personal and governmental ability. Age causes governmental abilities but governmental abilities cause things like wage. I think saying ability covers a wider range which is why I suggested it. : )
  • AmpersandAmpersand 858 Pts   -  
    Yes, income inequality is bad.

    Firstly because it often goes against out conception of merit based rewards. As Piketty's Capitalism in the 21st Century shows - which was lauded as being one of the most comprehensive and evidence based analyses yet put together in economics - there is a trend towards stratified inheritance based wealth rather than wealth earned through merit and hard work.

    Secondly there is a raft of evidence showing that income inequality in a society is harmful on a variety of levels, from health outcomes to education achievement to teen pregnancy to crime rates. Not only that but even the rich tend to recieve benefits in these areas in more equal societies.
    brontoraptorcheesycheese
  • ViceRegentViceRegent 68 Pts   -  
    What is wrong with inheritance? 

    And how does my having more money than you cause you to fornicate?

    These fool’s are incapable of critical thought.
  • MikeMike 97 Pts   -  
    Income inequality, or inequality in general, is very important throughout nature; for if things were equal, there will be no evolution.
    brontoraptorZombieguy1987cheesycheese
  • brontoraptorbrontoraptor 123 Pts   -  
    @melanielust

    Having no "income inequality" is harmful. Why? It would promote no one working hard. Why would I do anything if I get the same without working hard? The entire system would collapse.
  • averyaproaveryapro 150 Pts   -  
    The rich people are clearly working hard and they have a good job then they deserve to be rich and have this money. However, if the poor people aren't working and aren't putting in their best effort then they don't deserve all of this money.
    Zombieguy1987cheesycheese
  • MayCaesarMayCaesar 5966 Pts   -  
    Inequality in itself is not harmful in any way. However, extreme inequality often arises not as a result of growing economy, but as a result of decaying corrupt system. It is not the cause of economical problems, but it can be their symptom.

    To illustrate why inequality in itself is not problematic, consider the following example. Let us measure the amount of goods owned by people in "pips". Let us take an imaginary country Wonderia. In 2200, in this country bottom 90% population own 1,000 pips per person, and top 10% population own 1,000,000 pips per person. But in 2300, bottom 90% population now owns 10,000,000 pips per person, while top 10% population now owns 1,000,000,000,000,000 pips per person. The relative inequality between top 10% and bottom 90% increased from 1,000-to-1 to 100,000,000-to-1, and yet the poorest person is now richer than the richest person was 100 years ago - clearly the economy is doing far-far better than before, even despite the inequality increasing by 5 orders of magnitude.

    However, this is not what tends to happen in real countries with high inequality. In real countries, what tends to happen is the Zimbabwean scenario: the ruling regime seizes all the resources and redistributes them in a way that leaves almost everyone dirt-poor, except for the narrow elite. Or a softer scenario such as pre-communist Cuba, where the majority of the population enjoyed a pretty luxurious life, but the regular workers were hardly better off than serfs - human rights did not apply to everyone, and that eventually killed that country off and resurrected an abomination in its place.

    To summarize, inequality itself is hardly important, and both a country with extremely high inequality and a country with perfect inequality can be doing well or poorly. But extremes tend to coincide with other critical economical problems.
    cheesycheese
  • cheesycheesecheesycheese 79 Pts   -  
    holoe said:
    No, people who work hard deserve more, that includes money.
    Also people who have rich parents apparently deserve more
    OshokeSule
  • cheesycheesecheesycheese 79 Pts   -  
    Obvious sarcasm
  • CYDdhartaCYDdharta 1823 Pts   -  

    Also people who have rich parents apparently deserve more

    One of the primary reasons people work hard is to give their family the best life possible.
    cheesycheeseZombieguy1987
  • cheesycheesecheesycheese 79 Pts   -  
    yes but it still isn't an even playing field with inheritance
    CYDdhartaZombieguy1987
  • CYDdhartaCYDdharta 1823 Pts   -  
    yes but it still isn't an even playing field with inheritance

    What's your point?  Who said the playing field was supposed to be even?  Who said life had to be fair?
    Zombieguy1987
  • Polaris95Polaris95 147 Pts   -  
    @CYDdharta

    Life isn't fair, but does that mean we shouldn't be?
    cheesycheese
  • MayCaesarMayCaesar 5966 Pts   -  
    @cheesycheese ;

    The playing field is even, since the inheritance rules apply to everyone equally. The initial conditions are not even, however; nor should they be.
  • cheesycheesecheesycheese 79 Pts   -  
    Lets invision two scenarios child A is born into a poor family with two unemployed parents child B is born into an exceptionally rich family with a booming family buisness starting with childhood child A goes to a public school that has terrible average grades child B goes to a first class school which resembles a five star hotel next for university assuming that they are both failures child A goes into debt child B having had their parents pay for them lose money but don’t go into debt and when their parents die child A gets some money but not a lot child B gets loads of money and a stable source of income from the family buisness these scenarios are very real and the child had nothing to do with it however their parents did control what class they would be in
  • MayCaesarMayCaesar 5966 Pts   -  
    I was born in a very poor totalitarian country in a poor family. I did not choose it, but nor did I ever feel mistreated, never felt that my conditions were somehow "unfair". I adapted to my circumstances, worked hard to improve them, and as a result I live in the country of my dreams, I love my work, and my economical perspectives are very bright.

    You know what would not get me to where I am? Complaining about the privileges of the people born in rich families in prosperous countries.

    That people with a better setup somehow owe to people with a worse setup - is a very poisonous notion. Every individual owes to exactly two categories of people: those they made a consensual contract with, and themselves. It is the individual's duty to find a way to get to where the rich and successful are, and not the other way around. This is how the world has always worked, and will always work. Your success is defined by your ability to adapt to the environment; the environment is not supposed to adapt to you.
    cheesycheese
  • SitaraSitara 17 Pts   -  
    I am an Eisenhower Republican. Tax the rich at 90%. I am tired of tax breaks for the wealthy.
  • cheesycheesecheesycheese 79 Pts   -  
    @Sitara
    that would be great corruption was non existent
  • SitaraSitara 17 Pts   -  
    @cheesycheese I know, right? Sadly, many in both parties are corrupt. I wanted Bernie.
    cheesycheeseCYDdharta
  • cheesycheesecheesycheese 79 Pts   -  
    CYDdharta said:
    yes but it still isn't an even playing field with inheritance

    What's your point?  Who said the playing field was supposed to be even?  Who said life had to be fair?
    Ok so you admit it capitalism isn’t fair
  • CYDdhartaCYDdharta 1823 Pts   -   edited October 2018

    Ok so you admit it capitalism isn’t fair

    Capitalism is about as fair as anything life.

    Again, what point are you trying to make?
  • MayCaesarMayCaesar 5966 Pts   -  
    @Sitara ;

    How about we tax the poor at 90% instead?

    No, let us do it more fairly: everybody is taxed at how much they want to tax others. For example, you want to tax the rich at 90% - so you are taxed at 90%. I want to tax everyone at 0%, so I am taxed at 0%.

    Something tells me that, as soon as the consequences of the tax proposals are put on those making them, their narrative will quickly change. Is it not so? ;) It is so easy to divide the loot between the fellow highwaymen - and so much harder to give away your own loot for dividing.
  • cheesycheesecheesycheese 79 Pts   -  
    CYDdharta said:

    Ok so you admit it capitalism isn’t fair

    Capitalism is about as fair as anything life.

    Again, what point are you trying to make?
    The point of capitalism is to be fair
  • CYDdhartaCYDdharta 1823 Pts   -  

    The point of capitalism is to be fair

    LOL where did you get that?  No, the point of Capitalism is to create the best economic environment so that the greatest number of people have the best chance to succeed.
  • cheesycheesecheesycheese 79 Pts   -  
    Thats simply rewording
  • CYDdhartaCYDdharta 1823 Pts   -  
    Thats simply rewording
    If you believe that, then you need to work on your command of the English language.  It isn't at all comparable.
    cheesycheese
  • cheesycheesecheesycheese 79 Pts   -  
    CYDdharta said:

    The point of capitalism is to be fair

    LOL where did you get that?  No, the point of Capitalism is to create the best economic environment so that the greatest number of people have the best chance to succeed.
    That is rewording the word fair economic fairness is what you said the point of capitalism is
  • CYDdhartaCYDdharta 1823 Pts   -  

    That is rewording the word fair economic fairness is what you said the point of capitalism is

    You seem to be replying to the wrong person.  Where did I ever say economic fairness was the point of capitalism? 
  • cheesycheesecheesycheese 79 Pts   -  
    The best economic environment so the greatest amount of people can succeed is economic fairness
  • CYDdhartaCYDdharta 1823 Pts   -  
    The best economic environment so the greatest amount of people can succeed is economic fairness

    I like to think so, but that's nothing like income equality.

  • cheesycheesecheesycheese 79 Pts   -  
    the point of income equality is to have the same amount of money for all the point of capitalism is for those who work hard to have more money
  • CYDdhartaCYDdharta 1823 Pts   -   edited October 2018
    the point of income equality is to have the same amount of money for all the point of capitalism is for those who work hard to have more money

    Income equality is neither fair nor efficient. It does NOT create the best economic environment so that the greatest number of people have the best chance to succeed.

  • MayCaesarMayCaesar 5966 Pts   -  
    @cheesycheese

    The point of capitalism is to give everyone the freedom to make consensual contracts, and to protect everyone from being forced into the contract they do not want to sign. It has nothing to do with the outcome; it is based on the principles of individual freedom and liberty. Freedom and liberty are not the means to some end; they are the end.

    It does not matter how hard you work, what matters is how well you work. Bashing your head into a wall for hours is a hard work, but it is pretty low in terms of its market value. On the other hand, uploading cat videos on Youtube is an easy work and can set you for life, if you are really smart and skillful about it - this easy work may have a high market value, if properly done.

    This is just one thing (among thousands) the income equality principle fails to account for: that how hard you work, or how much you work, in itself has nothing to do with the value of your work. Paying people based solely on the amount of hours they have worked, or on the field they are working in, or on their experience prior to work - is irrational and absurd.

    The only way to properly reward people for their work - is to let the contract behind their work decide how much they get paid. Any other system is going to be inherently unfair, unjust, abusing and economically poor and inefficient. Socialism in particular goes against every bit of common sense and assumes that all people are inherently just clones of each other, and all the work they can do has some inherent similarity. It is much like saying, "The lion and the rabbit are the same", and putting them in the same cage, hoping that the "fairness" works out.
    cheesycheese
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