Tag Archives: inequality

Americans don’t know about the level of wealth concentration in the United States

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Sociologists have been talking about the growing levels of inequality in the United States for some time now. But a recent survey suggests that Americans are unaware just how much wealth is concentrated at the top (and there is a lot more information on the topic at this link):

A remarkable study (Norton & Ariely, 2010) reveals that Americans have no idea that the wealth distribution (defined for them in terms of “net worth”) is as concentrated as it is. When shown three pie charts representing possible wealth distributions, 90% or more of the 5,522 respondents — whatever their gender, age, income level, or party affiliation — thought that the American wealth distribution most resembled one in which the top 20% has about 60% of the wealth. In fact, of course, the top 20% control about 85% of the wealth (refer back to Table 1 and Figure 1 in this document for a more detailed breakdown of the numbers).

Even more striking, they did not come close on the amount of wealth held by the bottom 40% of the population. It’s a number I haven’t even mentioned so far, and it’s shocking: the lowest two quintiles hold just 0.3% of the wealth in the United States. Most people in the survey guessed the figure to be between 8% and 10%, and two dozen academic economists got it wrong too, by guessing about 2% — seven times too high. Those surveyed did have it about right for what the 20% in the middle have; it’s at the top and the bottom that they don’t have any idea of what’s going on.

Americans from all walks of life were also united in their vision of what the “ideal” wealth distribution would be, which may come as an even bigger surprise than their shared misinformation on the actual wealth distribution. They said that the ideal wealth distribution would be one in which the top 20% owned between 30 and 40 percent of the privately held wealth, which is a far cry from the 85 percent that the top 20% actually own. They also said that the bottom 40% — that’s 120 million Americans — should have between 25% and 30%, not the mere 8% to 10% they thought this group had, and far above the 0.3% they actually had. In fact, there’s no country in the world that has a wealth distribution close to what Americans think is ideal when it comes to fairness. So maybe Americans are much more egalitarian than most of them realize about each other, at least in principle and before the rat race begins.

So Americans have some ideas about what the wealth distribution should look like but not much of an idea of what it actually looks like. What exactly might they do if they knew the exact figures since it doesn’t seem to line up with what they think it should be?

Read about the possible effects of this heavy concentration of wealth, including helping to bring about our recent economic crisis, here.

Inside Higher Ed’s “Sociologists in Sin City” raises some interesting issues

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Earlier this week, I offered some thoughts about the American Sociological Association meetings in Las Vegas and Inside Higher Ed also offered an overview of the conference:

There is something both jarring and perfectly apropos about bringing thousands of sociologists to Sin City. As the ASA press release delicately observed, “Las Vegas [is] vibrant and fascinating from a sociological perspective” – but it’s not difficult to conjecture why the conference had never been held here before. The very aspects of Las Vegas that might make it fascinating to a sociologist — the emphasis on consumerism and decadence; the unapologetic obsession with (and exploitation of) female flesh; and the city’s most celebrated pastime gambling, whose appeal is particularly mystifying to some with a background in statistics — are also the sorts of things that tend to be off-putting to academics, especially (or at least) in the presence of their colleagues. Little wonder that ol’ Lost Wages is one of the least-educated cities in the country. (As David Dickens, professor of sociology at the University of Nevada at Las Vegas, likes to say: “Thank god for Fresno.”) And little wonder, too, that even those who have dedicated their careers to studying human society weren’t wholly enthused about being thrust into the heart of this particular society, however fascinating it might be…

Sara Goldrick-Rab, associate professor of educational policy studies and sociology at the University of Wisconsin at Madison, emphatically agreed. “I found it hard to believe we sociologists would come to a place that clearly thrives on the exploitation of people’s financial and emotional insecurities,” she wrote in an e-mail. “The grotesque treatment of young women was visible and jarring.”…

Perhaps not incidentally, this faculty member was male – as was the graduate student from a highly respected private institution who suggested that any dislike of or discomfort with Las Vegas was limited to the conference’s female attendees. Also male: the grad student from a California public who smilingly boasted of having slipped a small bribe to the man at the check-in desk in exchange for a room with a good view of the pools (and the bikini-clad women therein) – which view, he said, he found rather distracting as he sat in his room preparing his presentation.

The article suggests several possible fault lines of opinion: between men and women (some of this is quoted above), those who like to gamble and those who do not, and those who work in Las Vegas (UNLV) versus elsewhere. But there was one particularly interesting thought from one of the UNLV sociologists:

Wade said it might not be a bad thing if the city made its visitors uncomfortable. Academics, she noted, tend to lead “pretty cushy” lives, and spending a few days in a difficult and even disturbing environment could prompt them to think about the “real people” who call the city home — and about the fact that, in many ways, Las Vegas is just a distilled and amplified representation of the world we all live in. “There’s a little bit of Vegas in all of us.”

I wonder how many sociologists would like to admit that as a possibility. But there is a point here: it is not as if exploitation, extreme gaps between the rich and poor, the objectification of women, and other issues are not present in other cities. Las Vegas, in its own unique way, seems to shove these issues in your face that doesn’t fit the typical academic experience.

Does this story suggest that sociologists are moralists, generally turned off by places like Las Vegas?

Reading that some people were unhappy to attend ASA in Las Vegas, it made me wonder whether ASA ever sends out surveys after the meetings to see how attendees liked the experience and what might be changed. If so, I don’t recall seeing one. Seeing that my car repair place always sends a survey afterwards, wouldn’t it make sense for ASA to do the same thing or do they not have to because they have a captive audience?

Another question: how exactly did Inside Higher Ed go about interviewing sociologists for this story?

Quick Review: ASA 2011 Las Vegas

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The 2011 American Sociological Association meetings are still going on in Las Vegas. While I was only out there for the first half of the meetings, here are a few thoughts on the annual convention:

1. Las Vegas presents a series of contradictions and this irony should not be lost on sociologists.

1a. When you fly in and out, you really see how the city rises right out of the desert.

1b. I stayed a little bit off of The Strip and this daily walk was interesting in that the landscape several blocks away was really empty, desert lots and more rundown facilities. The airport backs right up to the south end of The Strip.

1c. The opening plenary session on Friday night included discussions of different sociological traditions including feminism and Marxism. The reception afterwards included a greeting from a Las Vegas girl in a feathery costume and a Frank Sinatra and Sammy Davis, Jr. impersonator providing entertainment. Can one easily go from discussing inequality and oppression to enjoying the fruits of capitalistic success? The answer appeared to be yes.

2. Some of the main themes I heard at the sessions I attended: an interest in explaining the Tea Party; some nervousness (?) about the reelection prospects of President Obama; explanations that Democrats won the recent recall elections in Wisconsin (despite media reports to the contrary).

3. The conference is being held at Caesar’s Palace, just a gargantuan facility. The main conference hall must have been at least 1,500 feet long. Two downsides to the conference setting: a lack of nearby coffee shops (the closest one had ridiculous lines on both Saturday and Sunday mornings) and it was difficult to walk to other nearby attractions. One thing I noticed: while typical ASA meetings tend to tie up the facilities in one or perhaps even two big city hotels, we were just a drop in the bucket of Caesar’s Palace.

4. The Strip has to be one of the most fascinating streetscapes in the world. The combination of heat, casinos, people drinking while walking, families, the homeless, and more is a sight to behold. Of course, it is more interesting because it is all inauthentic: this isn’t a neighborhood where people live but it is an endless stream of visitors.

5. I know the country is experiencing economic difficulties but I don’t think you could tell this by simply looking at The Strip. There were plenty of people of all ages and backgrounds walking around and spending money. If you wanted to find a place to study consumption and/or tourism, this would be it.

6. One thing I just cannot understand: why is there not public transportation from the airport to The Strip? While there is a monorail that runs behind the hotels on the northern end of The Strip, one has to take a shuttle or a taxi from the airport. I don’t know if these private firms have a lot of political clout but it seems like the city would want to help people get from the airport to The Strip as quickly and cheaply as possible.

7. People say the heat is a “dry heat” – I do think it makes a difference. While it was roughly 103 degrees during the days I was there and it was still 94 degrees at 10 PM one night when I was out walking, I definitely felt the humidity in Chicago on Sunday night.

“There Are No Children Here” 20 years later

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Alex Kotlowitz’s book There Are No Children Here is a modern classic that describes the life of children within some of the poorest neighborhoods in the United States. Here is a little bit about the book and its aftermath:

“I’ve never thought about it being (a statement) about public housing,” Kotlowitz said while sitting in a cafe Friday near his home. “It could have taken place in any inner-city neighborhood.”…

Public housing now in Chicago is “not perfect, but it’s quite different from when we first started,” Popkin said, citing the transformation at Horner, the CHA’s commitment to resident services and the way that the agency is managed.

But many things remain the same. The poor are still extremely segregated, Kotlowitz said. Deadly violence still defines impoverished communities where rampant shootings are committed by a new generation of so-called cliques…

The brothers [Lafeyette and Pharoah Walton], now 36 and 33, have dealt with their share of adversity. They have both served time in prison and continue to struggle with poverty.

As Sue Popkin suggests, the book helped humanize the problems these children face. It is one thing to have stereotypes and broad ideas about what happens in poorer neighborhoods but another thing to get to know and start rooting for children who live there.

On the whole, it sounds like there is still a lot of work to do regarding public housing, poor neighborhoods, and helping children in these neighborhoods obtain a good education and reach a middle-class lifestyle. Would another, similar book help in this cause? These concerns rarely bubble up to the top of American public discussions.

“The Marginalization of Marriage” report says marriage is helpful in achieving the American Dream

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A new report from the Brookings Institute, written by one conservative sociologist and one liberal sociologist, suggests that marriage is helpful for achieving the American Dream:

To be sure, not every married family is a healthy one that benefits children. Yet, on average, the institution of marriage conveys important benefits to adults and children. This advantage may be due to the greater stability of the marriage bond, or to the kinds of people who choose to marry and to stay married, or to qualities associated with the institution of marriage (such as a greater degree of commitment and investment in family life). Let us assume that all of these factors play a role. The fact is that children born and raised in intact, married homes typically enjoy higher quality relationships with their parents, are more likely to steer clear of trouble with the law, to graduate from high school and college, to be gainfully employed as adults, and to enjoy stable marriages of their own in adulthood. Women and men who get and stay married are more likely to accrue substantial financial assets and to enjoy good physical and mental health. In fact, married men enjoy a wage premium compared to their single peers that may exceed 10 percent. At the collective level, the retreat from marriage has played a noteworthy role in fueling the growth in family income inequality and child poverty that has beset the nation since the 1970s. For all these reasons, then, the institution of marriage has been an important pillar of the American Dream, and the erosion of marriage in Middle America is one reason the dream is increasingly out of reach for men, women, and children from moderately-educated homes.

This strikes me as an odd defense of marriage. This reasoning is very pragmatic: because marriage is successful in helping people reach the American Dream, therefore, people should look for such relationships. I could imagine several objections to this argument:

1. There are better reasons for defending marriage as an institution. Tying marriage to a particular successful life sequence could take the emphasis away from the relationship and move it to acquiring particular material possessions, life chances, and statuses. Ultimately, it seems to me that the current debate around marital practices in the United States comes down to moral beliefs.

2. Perhaps the notion of the American Dream is changing. Just because this has worked in the past doesn’t mean that this is what Americans want to pursue in the future.

3. There are other notable reasons for the growing inequality and rise in child poverty in the United States over the last few decades.

All in all, I imagine this report could generate a significant amount of debate.

Largest wealth gap in the United States

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The gap in wealth between whites and blacks in the United States has been well documented. New figures suggest that the gap is now wider between whites and both blacks and Latinos:

The wealth gaps between whites and minorities have grown to their widest levels since the U.S. government began tabulating them a quarter-century ago. The recession and uneven recovery have erased decades of minority gains, leaving whites on average with 20 times the net worth of blacks and 18 times that of Hispanics, according to an analysis of new Census data…

“I am afraid that this pushes us back to what the Kerner Commission characterized as `two societies, separate and unequal,'” said Roderick Harrison, a former chief of racial statistics at the Census Bureau, referring to the 1960s presidential commission that examined U.S. race relations. “The great difference is that the second society has now become both black and Hispanic.”

The median wealth of white U.S. households in 2009 was $113,149, compared to $6,325 for Hispanics and $5,677 for blacks, according to the analysis released Tuesday by the Pew Research Center. Those ratios, roughly 20 to 1 for blacks and 18 to 1 for Hispanics, far exceed the low mark of 7 to 1 for both groups reached in 1995, when the nation’s economic expansion lifted many low-income groups to the middle class…

Across all race and ethnic groups, the wealth gap between rich and poor widened. The share of wealth held by the top 10 percent of U.S. households increased from 49 percent in 2005 to 56 percent in 2009. The threshold for entry into the wealthiest top 10 percent, however, dipped lower: from $646,327 in 2005 to $598,435.

The American ideal, at least in theory, is that everyone has the chance to become at least middle-class through hard work and over the generations (though this new study in American Sociological Review suggests illegal immigrants may not experience this). This data suggests that this idea might have seemed more true in the boom periods of the 1990s and 2000s when a growing economy helped lift everyone’s boat. But, when an economic crisis hit, the numbers suggest all (or most) took a hit but some were hit more than others. All together, these boom periods helped obscure the inequalities in wealth that existed and were growing even though the big figures in the economy looked good.

I would think this should be of concern to all political parties.

Social inequalities in accessing open government data

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Some governments are providing more open data. But, this may not be enough as citizens don’t necessarily have equal access to the data or abilities to interpret the information:

At least 16 nations have major open data initiatives; in many more, pressure is building for them to follow suit. The US has posted nearly 400,000 data sets at Data.gov, and organizations like the Sunlight Foundation and MAPlight.org are finding compelling ways to use public data—like linking political contributions to political actions. It’s the kind of thing that seems to prove Louis Brandeis’ famous comment: “Sunlight is said to be the best of disinfectants.” But transparency alone is not a panacea, and it may even have a few nasty side effects. Take the case of the Bhoomi Project, an ambitious effort by the southern Indian state of Karnataka to digitize some 20 million land titles, making them more accessible. It was supposed to be a shining example of e-governance: open data that would benefit everyone and bring new efficiencies to the world’s largest democracy. Instead, the portal proved a boon to corporations and the wealthy, who hired lawyers and predatory land agents to challenge titles, hunt for errors in documentation, exploit gaps in records, identify targets for bribery, and snap up property. An initiative that was intended to level the playing field for small landholders ended up penalizing them; bribery costs and processing time actually increased.

A level playing field doesn’t mean much if you don’t know the rules or have the right sporting equipment. Uploading a million documents to the Internet doesn’t help people who don’t know how to sift through them. Michael Gurstein, a community informatics expert in Vancouver, British Columbia, has dubbed this problem the data divide. Indeed, a recent study on the use of open government data in Great Britain points out that most of the people using the information are already data sophisticates. The less sophisticated often don’t even know it’s there.

This touches on two issues of social inequality that are not discussed as much as they might be. First, not everyone has consistent access to the internet. It may be a necessity for the younger generations but for example, there are still problems in doing web surveys because internet users are not a representative cross-sample of the US population. Making the data available on the internet would make it available to more users but not necessarily all users. This ties in with some earlier thoughts I’ve had about whether internet access will become a de facto or defined human right in the future.

Second, not everyone knows where the open data is or how to go through it. Government information dumps require sorting through and some time to figure out what is going on. There may or may not be a guide through the information. As someone who has worked with some large sociological datasets, it always takes some time to become acclimated with the files and data before one can begin an analysis. This should legitimately become part of a college education: some training in how to sort through information and common databases. If we get to a point where the average informed citizen needs to be able to sort through government information online, wouldn’t this be a basic skill that all need to be taught? As the commentator suggests, the trained and sophisticated can take advantage of this data while the average citizen may be left behind.

The idea of having more open government information should cause us to think about how the internet might help close the gap between people (though I don’t hold any utopian expectations about this) rather than sustain or exacerbate social inequalities.

Questions to ask about the wealth gap in the United States

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The income and wealth gap (also here for information about wealth) in America has grown in recent decades. But rather than simply decry this trend, a sociologist suggests that we should ask some questions:

When it comes to division of wealth, the topic is best tackled by asking questions rather than making statements, according to Mike Dalecki, a professor of sociology at the University of Wisconsin-Platteville.

“How big a gap should there be?” he said, of the wealth divide in the U.S.

“At what point does that gap become so great that we start to have serious societal problems?” Dalecki asked…

How much money do people need to make per year to be satisfied?

If the nation’s wealth divide continues to expand, is there a failure in the economy itself or the ways the rules are written?

Should the wealthiest people pay more taxes?

At what point will they be taxed so much they leave for a different state or country?

These are some good questions because they address larger issues: how do these figures relate to American values and policies? What is an appropriate gap in wealth and how far should we go through measures like taxes to try to limit this gap? These questions link the wealth gap to larger structural and cultural concerns that should interest many Americans. These are the kind of questions I like to ask my Introduction to Sociology courses because they then have to think about how this issue of inequality relates to their thoughts about a “good” or “just” society.

I also think the emphasis here on wealth, instead of just income, is helpful. Income gives you part of the picture but wealth is more accurate measure of the resources people accumulate over time and then can pass on to their descendents. This wealth gap is particularly stark between racial and ethnic groups.

More on people living beneath Las Vegas

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I first ran into a story on people living under Las Vegas in The Sun (UK) two years ago. The most recent edition of Newsweek also briefly discusses this situation as part of a larger article about Las Vegas and the impact Celine Dion has had on the city:

At the south end of the Strip, near the iconic “Welcome to Fabulous Las Vegas” sign, a hidden concrete path leads into a 500-mile warren of wet, trash-strewn drainage pipes that function as an underground shelter for hundreds of the city’s most downtrodden. Several have been laid off from the same well-paid, benefits-packed service jobs that give Vegas its rep as a working-class paradise. The pipes are one of the few places police and hotel security don’t bother to tread, and since the recession, they’ve become increasingly populated, according to Matthew O’Brien, author of a 2007 book about the tunnels, Beneath the Neon.

Life here is spare and dangerous. Aside from floods that can fill the space in minutes, there is ever-present crime. Jody Alger, 48, an unemployed casino waitress, guards her tunnel with a BB gun. Another camp has two makeshift barricades at its entrance; inside, its 32-year-old inhabitant huddles on an old bed with a flashlight strapped to his head. In a nearby tunnel, John Tondee sleeps on a sagging leather couch that he found in a Dumpster. His clothes are in a messy pile, and his entertainment is a guitar with a broken string, which he uses for playing country gospel. “I’m at the point of coming out of here,” he says. “I’ve had enough.” Tondee says he’s a former maintenance worker who lost his job a year ago and couldn’t afford to pay the $675 in rent. “I’ll do whatever it takes to survive,” he says. “I’ll go around and wash windows.” At night, he used to dress in drag and walk down the Strip. But someone came into the tunnel and stole his 16 wigs. Now he has only one head of fake black curls left.

These two paragraphs are meant to set up a comparison between the glitzy and popular Celine Dion shows at Caesar’s Palace and the desperate times some residents are facing.

But from what I can gather, people living underneath a city is not a limited phenomenon perhaps tied to difficult economic times. The space underneath cities can be easier to access than people might realize: this story about Paris suggests all sorts of people end up exploring this area (though many of them are on tours of the Paris Catacombs). And the 1995 book The Mole People: Life in the Tunnels Beneath New York City, which I first read for my undergraduate Introduction to Sociology class, is a fascinating look at how a number of people have carved out a life in a space that most would avoid.

Richard Florida argues cities increase levels of inequality

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Richard Florida, dubber of the Creative Class, argues that data shows that cities exacerbate levels of inequality:

“Something fundamental has changed in our economy, and it’s happening at the metropolitan level,” explains Baum-Snow. “If we want to understand what’s causing the wage gap, we now know we need to look at the unique economies of our larger cities,” adds Pavan.

Both the U.S. and the world have grown increasingly spiky, with our socio-economic divide increasingly overlaid with a growing economic geography of class.  Big cities like New York and LA have attracted wealthy people not just from America but from around the world.  This trend reflects the growing advantages of geographic clustering or agglomeration.  The larger and more populous a city or region, the more likely it is to have the human capital and economic ecosystems required to support the most advanced — and hence the highest-paying — technologies and industries.  Bigger cities attract more innovators, more entrepreneurs, and more highly skilled and ambitious people in general, and provide a fluid environment where these individuals can combine and recombine their skills. Big cities also generate powerful economies of scale and scope, resulting in higher rates of innovation, new firm formation, and productivity.  They attract better-educated, better-trained, more-experienced workers, driving up wages.

At other side of the spectrum, manufacturing, which once clustered in and around large cities and metros, has shifted to less expensive suburban, exurban, and off-shore locations. And large cities have become home to a large and growing contingent of lower-skill, lower pay service jobs — from childcare and food preparation to retail sales and personal services.  Taken together these factors have in effect divided or bifurcated the labor market in big cities into highly paid “creators” and much lower-paid “servers.”

On the other side, Florida also shows a (very modest) correlation that city size is related to higher wages. But overall, Florida argues that cities draw both the uber-wealthy and those who “serve” the city.

Florida doesn’t present much data here so we would need more analysis in order to figure out what is going on. Does this argument present a  counterpoint to these two articles about the future of cities and suburbs in Foreign Policy last fall? It is hard to tell – Florida also says that cities are centers of innovation and entrepreneurship. And even if cities do have extreme levels of inequality, do they benefit larger society enough to offset the inequality within their borders?

(Interestingly, both Florida’s data and the study he cites use metropolitan areas to mean cities. This makes a lot of sense: central cities and suburbs should be viewed more often as single, interdependent units. Would the inequality be even more pronounced if the analysis was limited to central city borders?)