This article mainly draws attention to the widening gap between the rich and the poor in the global community. The paper argues that despite America declaring itself as one of the highly developed nations, it is still facing a high economic disparity level. According to the article, wealth distribution among the few elites cannot be ignored (Freeland, 2011). In turn, the affluent community has massively increased political influence, generating casual indifference and tension. In essence, Freeland accepts that the globally connected economy and rush for fortune have resulted in new elite members who have created a second-generation class. This trend has led to the promotion of self-regard and deliberate development of a negative attitude towards societys less fortunate members.
Methods Employed
The paper uses various techniques like observation and critical analysis of secondary sources such as watching the National Broadcasting News (NBC) to recognize the variation in current society between the rich and the poor. Through the application of these approaches, the researcher manages to explore the subject of wealth in the creation of the division that exists. Freeman accepts that promotion of the trend has resulted in American financial giants who lack the power to propel the national economy.
The Results
The findings indicated that an increasing gap between the rich and the poor was a reality in the world. The article concluded that these members accumulate wealth in a dishonest manner (Freeland, 2011). Therefore, she intends to use the article to provide useful advice to the members to avoid the unprecedented move to create a currently observed division in society. Through the article, Freeland aims to create equality and sanity in most members lives. The paper has managed to show the demerits of such a discriminative global economic movement.
The growing wealth inequality in the US is now a major social issue. As such, academics, including sociologists and economists, have explored wealth inequality from various perspectives and found multiple responsible variables. For instance, the video, the Extent of U.S. Wealth Inequality, presents a dramatic extent of that imbalance by using graphic details to enhance understanding. In this assessment, three distinct factors responsible for the divide between the top 10% and the rest of the population have been explored (Wealth Inequality In USA or Rich vs Poor In America). Finally, the assessment presents two suggestions that can be used to reduce the gap.
Changes in the national and global economy are responsible for the growing wealth inequality in the US. While actions of individual investors, specifically greed on Wall Street, have escalated inequality, social conditions considered as economic restructuring have led to widespread inequality. The economic restructuring reflects the ongoing changes in the US economy. Notably, previously stable jobs found in the manufacturing sector in the US have steadily declined, leaving millions of unemployed persons. Moreover, the US has grown to be the home of tech giants, which have led to a significant reduction of the workforce across various industries. Further, globalization and technologies have facilitated the outsourcing of jobs previously done in the US. Consequently, these jobs are now done in emerging economies at the lowest cost possible. Overall, many people previously employed, if they find jobs at all, now work for minimum wages with limited benefits. These changes in the US economy have largely contributed to the widening gap between the ultra-elite and the bottom class.
Wealth concentration is another factor that has wealth inequality in the US (Damon 1). Wealth is generally concentrated in corporate shares and the personal wealth of the ultra-elite in the US. They control a significant fraction of the national and global wealth (Elliott and Pilkington 1; Matthews 1). The class has dominated wealth accumulation from one generation to the next while newcomers are relatively few.
Gender and age factors have also largely contributed to social equality in the US. For several decades, there have been affirmative action and laws to protect women from pay variances. However, men continue to enjoy relatively higher salaries compared to their female colleagues for the same job. In the year 2014, for instance, it was noted that women were paid about 79% of what their male counterparts earned, reflecting a pay gap of 21% (Hill 1). While the gap continues to narrow because of increased womens participation at the workplace, achievement in education, and slow progress of mens salaries, there are still notable variations reflected across age, education, locations, and race. With the age factor, earnings tend to rise until they stagnate for women when they attain age 35 years (Hill 1).
One must appreciate that addressing social or wealth inequality in society is not a simple task. Nevertheless, multiple possible solutions have been offered.
Effective fiscal policy is viewed as a critical tool for tackling wealth inequality (Dabla-Norris et al. 30). Fiscal policy can enhance macrofinancial stability and assist in controlling the impacts of economic crises, which have severe effects on the marginalized majorities. In this case, redistributive functions of fiscal policy can help in wealth distribution by addressing the growing income inequality, taxation, controlling tax avoidance and evasion, and reinforcing social benefits, such as savings.
Education policies can increase the skill levels of many disadvantaged individuals. As such, they will be able to cope with the technological changes required at workplaces and increase their income prospects. These policies should target financial barriers that limit access to education.
Works Cited
Dabla-Norris, Era, Kalpana Kochhar, Nujin Suphaphiphat, Frantisek Ricka, and Evridiki Tsounta. Causes and Consequences of Income Inequality: A Global Perspective. 2015. Web.
Damon, Andre. Growing Social Inequality in America. Wealth Concentration and Decline in Living Standards. Global Research. 2014. Web.
Elliott, Larry and Ed Pilkington. New Oxfam report says half of global wealth held by the 1%. The Guardian. 2015. Web.
Hill, Catherine. The Simple Truth about the Gender Pay Gap. Economic Justice. 2016. Web.
Matthews, Chris. Wealth inequality in America: Its worse than you think. Fortune. 2014. Web.
Wealth Inequality In USA or Rich vs Poor In America. Online video clip. YouTube. 2013. Web.
Achieving wealth and prestige is often the life goal of many young people. Money brings such advantages as better food and medicine, any things a person needs and wants, as well as the fulfillment of almost any desires without effort. However, stories of spoiled children of millionaires or pop stars who have harmed themselves or their health because of their status or wealth demonstrate that money can also make problems. Besides, the harm of wealth can be less obvious and reflected in such aspects as the quality of education, since the prestige of schools and universities often makes its students too competitive and requires more effort from them (). Consequently, while wealth gives students opportunities to study at the most prestigious universities, it can bring them more disadvantages than benefits.
For most people, wealth seems to be a source of opportunity and advantage that gives access to the best things in the world; however, it has its drawbacks. The first disadvantage that Gladwell () discusses is that the high level of parental wealth most often prevents children from appreciating the value of money and the hard work they require. For this reason, the difficulty of parenting increases in proportion to the level of wealth if the family earns more than $ 75,000 per year (33). In other words, higher levels of wealth create conditions in which children have fewer skills to develop and succeed on their own. Consequently, this disadvantage reduces young peoples chances to be independent, have high academic or other achievements that will help them reach their own goals.
The second disadvantage of wealth is that it does not guarantee happiness. Just like in the case of parenting difficulty, the level of happiness rises in proportion to the level of earnings up to a specific line but then begins to decline (31). This fact reflects the well-known truth that money cannot buy happiness. Perhaps this fact exists because wealthier people are less happy about everyday small things that are not available to people with low or middle income. Another reason can be that wealthy parents need to set artificial limits for their children, which can cause a lack of understanding and conflict between them. In any case, wealth does not guarantee happiness, and in some cases, it can hinder it.
Another disadvantage, which is most surprising to most people, is that parental wealth can negatively impact their childrens education. Gladwell (38) gives the example of private schools and elite boarding schools, in which each class has no more than 10-12 people, which prevents the effective work of students and teachers. Gladwell (36) argues that too small classes limit the teachers ability to provide knowledge and also diminish the diversity and ability of students to be autonomous. One teacher in a group of nine students says, You cant get any kind of conversation or discussion going in the target language. Its difficult to play games to reinforce vocabulary, grammar skills, et cetera. (37). Consequently, private schools that are accessible to children of wealthy parents can negatively impact their academic achievement due to class size and teacher focus. Thus, all these facts show that wealth has its disadvantages that can be overcome but often ignored.
These wealth aspects also suggest that while most people want to be part of something big and prestigious, in some cases, it may be better to stay small and independent. This assumption is especially relevant to the sphere of higher education and work. In almost every country, there are the best universities with high status and, therefore, high requirements. In the USA, such universities belong to the Ivy League, and only those who have high academic knowledge and money can become their students. However, in chapter three of his book, Gladwell explains that the prestige of a university does not always mean that its students get a better education and, in general, can get a degree. This situation occurs because there is constant high competition among students at Ivy League colleges and increased demands for their academic and extracurricular activities. Students compare themselves to others and most often feel not good enough, since high achievement in all classes is almost unrealistic. For this reason, many students lose interest and motivation to study and leave the university without receiving a degree.
The purpose of this issue discussion is to show that the most prestigious and famous is not always the most suitable for all people. Gladwell recounts the example of student Caroline Sacks, who left science only because she got lost as a student in Harvards huge pond. For a girl, like many other students, it would be more comfortable to study at a less prestigious university but to achieve her academic goals. For example, Gladwell also says that graduates from universities outside the Ivy League have more scientific publications, which benefits them after graduation since they have more free time from school to pursue their talents. (50). In addition, as a result, a higher percentage of students at these universities complete their studies, even if they had low admission scores, while similar statistics for Ivy League students are less satisfactory (49-50). Hence, in terms of future employment opportunities, less well-known universities are also more suitable options for most students.
Consequently, being involved in something big and prestigious is an excellent opportunity for a small number of people who have strong ambitions and willpower. These people will probably be able to become big fish in a large pond or be content with their position as small fish. However, as Gladwell points out to most people, Its the Little Pond that maximizes your chances to do whatever you want (53). A person who has the desire, resources, and freedom to do their own thing can achieve significant success in their field, and even if it does not bring him or her the most significant profit, it will give happiness. Thus, regardless of the level of wealth and knowledge, all people should choose a university that matches the strength of their ambitions to achieve success in their field and not get lost among other people.
Thus, Gladwells book and discussions on wealth demonstrate that wealth is not the solution to all problems, especially in higher education, despite all its benefits. Wealth can cause problems, such as young peoples inability to value money and work, difficulties in raising and educating children. At the same time, money does not guarantee that people feel in their place if their ambitions and expectations do not coincide with the reality of studying at prestigious universities. For many people, Harvard or Brown University is too competitive and demanding and does not leave the freedom and time for personal choice and development. This feature forces many students to leave their studies and choose less prestigious but freer universities to achieve their goals and interests. Thus, in most cases, the Small Pond is the best option for many students, despite the opportunities that their level of income gives them.
Work Cited
Gladwell, Malcolm. David and Goliath: Underdogs, Misfits, and the Art of Battling Giants. Little, Brown and Company, 2015.
A current events summary is a concise assessment of an event that has occurred recently or will arise in the near future. The article is possible to be analyzed utilizing the methodology of descriptive (positive) dissection. The work is considered to be completed using at least one of the following economic and social principles: cost benefit, the opportunity cost, and the marginal tenet of interdependence. The article that was selected for the particular assignment is connected with the Pandora papers scandal. The Pandora Papers is a release of nearly 12 million files that reveals personal income and tax evasion by the worlds most influential people.
Main body
Descriptive analysis is a form of research methodology that serves to depict, display constructively, or summarize data points, figures, and statistics. Accordingly, the Pandora Papers is considered as one of the most substantial information leaks since more than 600 investigators from 117 countries combed through 14 sources data, uncovering the secret material (Offshore havens). It is feasible to relate the article with the opportunity cost principle due to the fact that the journalists faced a dilemma. They had to decide whether to accept the risk and hold an investigation or to continue to work quietly in their home countries without endangering the career and reputation.
Summary
To summarize, the article was analyzed based on the fundamental concepts of descriptive statistics. The Pandora Papers refer to the opportunity cost principle since it is possible to notice the presence of the problem of choice and its features that result in estimating the outcomes and deciding. The journalists took responsibility for publishing the materials, realizing the potential consequences that could appear after the scandal.
Work Cited
Offshore havens and hidden riches of world leaders and billionaires exposed in unprecedented leak. International Consortium of Investigative journalists, 2021, Web.
The story of the rich young ruler as given in Matthew chapter 19 from verses 16 to 30 reveals that the various persona in the text have different powers. In this text, Jesus is giving a critical lesson about the Kingdom of God. Jesus does not imply that the rich will not be saved, because in the Old Testament several rich people became pillars of the Jewish faith. However, at the time, people had developed a notion that wealthy people would have an automatic place in Gods kingdom because it was believed that their riches were Gods blessings. On the other hand, those living in poverty were believed to experience punishment for their sins. However, Jesus reveals that it is hard for a rich person to enter and inherit Gods kingdom with the limited human power.
Main body
The text reveals different levels of power among various players in the event. The rich young ruler is powerful and has enormous wealth. His possessions seemed insufficient, and he sought something more satisfying than what he had. The young mans power made him feel that he could get everything he wanted, which is why when he was asked to sell his possessions and give the proceeds to the poor, he got angry. He had expected that Jesus would consider his power and influence and would give him a more pleasing response than the one he got. Jesuss answer also revealed the innate power of the young man. When Jesus told the young man that he should share his possession with the less fortunate, He reveals that the young man had the power to inherit Gods kingdom.
The story of the rich young ruler puts the rich people on the margin of the story. Jesuss answer reveals what had not been open to the eyes of the Jews regarding the rich. Christ was angry with the response He received from the young man, which may have been the reason He spoke with His disciplines and told them how hard it is for a rich man to enter heaven. Jesus words were deeper, pointing to the error that escaped humanity. However, to some extent, Jesus placed all the rich people at a critical point concerning inheriting the kingdom of God. Having possessions should not be associated with missing eternity, because wealth is a gift from God. The response the young man gave was personal and may not have necessarily been because of his wealth status, as other rich men would have done exactly as Jesus instructed.
Jesus mentions that the young man should sell his possessions and give them to the poor. The ministry to the less fortunate has been seen as an act of kindness, which would grant one the possession of Gods kingdom. This context, therefore, teaches the opposite of what the Jewish people believed about the poor; that it is God who gives wealth to the good and bad people as He pleases. Consequently, those who share their possessions with the less fortunate are ministering to their needs, as a means for God to reach them. The poor are at the margin of the story because ministry to them occupies a critical position in the entry to Gods kingdom.
The account of the Rich Young Man gives God His powerful position in the universe. Jesus was angered with the response the young ruler gave and made a remark that it would be difficult for the rich to enter the Kingdom of heaven. Jesus compares a wealthy man inheriting eternal life to a camel going through the eye of the needle. While this looks impossible to humans, Jesus quickly reveals that it is possible with God. The eye of the needle has been a small gave in Jerusalem where the camel had to kneel to pass through. Some scholars have attributed this to the necessity of humility among the rich if they should inherit the kingdom of God. However, God is all-powerful and does not require humans to formulate ways to understand how He can make an impossible occurrence happen.
The story does not directly show the presence of Satan, especially in the lives of the disciples. A quick look into the future reveals that Satan was present in the story. For instance, Jesus speaks about the twelve being among those who will judge the world. However, when Judas betrays Jesus, Christ says that the man should not have been born for he faces a sharp judgment for killing the son of God. Satan was later revealed in Judas, making his offer himself as the instrument to show the captures of Jesus who he was so they would seize him. It is not directly clear how Jesus did not see that Satan was with Judas and that he would be the one to hand him over to be captured and crucified. It is therefore critical to argue that when Jesus talked about the first being last and the last being first, he might have referred to Judas being close to Him yet miss the same position at the end.
The conversation is a critical way to impart heavenly lessons to the listeners. It forms the basis for imparting truth regarding ordinary things and how they relate to the infinite heavenly provisions. The questions the young man gave Peter formed the basis on which Jesus developed His discussions, allowing readers to immerse themselves in what Jesus wanted to say. However, the historical context is crucial to the understanding of what Christ taught His disciples. The Jews of Jesuss time believed that keeping the commandments was the only way to enter the kingdom of God. However, Jesus uses the opportunity to impart an eternal concept, that entering the eternal life requires a complete surrender to do Gods will. Jesus asked the young ruler to sell his possessions not because doing so would warrant his salvation, but because it would show his true affection for God. At the same time, works have their share as they are evidence of living faith.
Conclusion
In conclusion, the story of the rich young ruler invites conversations and critiques, as several instances conflict with other teachings and experiences in the Bible. For instance, the Bible in Deuteronomy chapter eight and verse 18 says that one should remember that it is God who gives humans the power to make wealth and to fulfill His promises to forefathers. Therefore, one would desire to understand if wealth is good or bad for salvation. The passage also leaves the question of whether or not Judas would be among the twelve judging the world. One would desire to know the extent to which Jesus knew the future, as Jesus was supposed to know what Judas would do to Him. Moreover, the text begs the question as to whether the writers spoke their own words or were wrote the exact words of Jesus, especially in this context.
A good example of administering life is when human beings link money with power. Wealth is seen as a source of power. Rich people in society are highly regarded as compared to poor ones. Society has a way of linking wealth with power; this is a belief that administers human life since rich people are treated with respect regardless of their academic level. Financial status has been used as a basis of ranking people in the society; it is common to find rich people living in big estates while the poor live in suburbs.
Without even asking, one can readily tell that region X is inhabited by the rich or the poor. When it comes to selecting a group or party leader, people prefer a rich person since they saw him or her as having the appropriate skills to lead. This belief administers life to the extent that people always want to associate themselves with the rich. It is common to find people desiring to be associated with a distance rich relative even though the relationship has to be traced from far.
This is one of the beliefs that are widespread in society on a global scale. The best inventions in the world originate from developed countries. These countries are rich in resources, the less developed or developing countries look up to these countries for help. The idea of administering life has been upheld to the extent that innovations from the developing countries are disregarded. The more powerful countries are those that are rich in resources and have skilled manpower. The west way of life is admired by many since it is seen as a superpower whose way of life is perfect and stylish.
(Re) defining normal
The word normal has been used to refer to the outcome following the transformation of human existence to objects of power. This means that some aspects of human life become governing forces of human behavior in society. Through this power, we can distinguish between good and bad. It, therefore, becomes easy to tell who is acting according to the set rules and who is not. When certain aspects of human existence become objects of power, the behavioral patterns of such people towards some phenomena can be accounted for concerning how individuals perceive different aspects of life.
This way, people in a given society may hold different beliefs concerning an issue even though their cultural backgrounds are the same. Normal in our day-to-day life can be exemplified by the emergence of differing views concerning an issue, especially for politicians. The mode in which the politicians handle debates shows that human beings have their unique ways of looking into specific issues in life.
Acting upon the action of others
This refers to the act of judging whether something is wrong or right. By judging, the power attempts to correct us by discerning good from the bad. This means that actions are judged according to the set rules hence if they do not go according to the expectations, they are regarded as bad. The power also attempts to change our way of looking at certain things by changing our attitude. It makes it possible for one to decide between the possible and the impossible.
Works Cited
Foucault, Michael. The subject and power. New York: NYU Press, 2004. pp. 1-154.
Davis exploration of the future expectations of urbanization in the radical yet unequally and highly unstable global world indicates that urbanization and industrialization are incoherent. Urbanization always forms aspects of industrialization and economical escalation in most developed countries, but the developing countries are full of shanty housing units that are the habitat for many people, thus making them far from the formal world of economic advancement (Davis, 2006).
According to Davis (2006), the increase of the slums is fully unnoticed by the classic Marxism and other liberation theories such as neo-liberal. The writer presents the global overview of the divers political, religious and ethnic groups or movements, fighting for personal growth and benefits at the expense of the poor.
The writing brings about data from various global locations such as Bombay where he gives the analysis of Hindu fundamentalism, Casablanca in Cairo where he talks of the Islamic resistance among others. His main question regards the role of urbanized and well off economies on the matter slums in developing countries.
Does the exponential growth of the slums have a link to the poor or corrupt administrations? Are the IMF and other handouts such as the structural assistance programs, a massive transfer of the wealth from the poor to the rich? The writing of Davis revamps the myth of ‘self-help salvation,’ indicating irresponsible leadership in support of personal gains while the poor and middle class continues to perish.
There is an indication that the battlefields between the wealthy or economically stable countries and the terrorists are occurring at the poor people peripheries (Davis, 2006). The geographically stable political elites fail to look upon and recognize the existence of problems caused by imperial social controls on the slums.
What causes the urban populations to out number the rural? The urbanization my be catalyzed by Informal wages, food handouts from first world countries, development needs, modernization, poverty or social class status, but the gigantic concentrations of poverty in urban slums are economically and logically unsustainable.
The decoupling of urbanization from industrialization is posing some reality. The growth of populations in the urban centres does not translate to growth of production especially in the sub-Saharan Africa, Middle East, Latin America and parts of Asia.
The urbanization without a good link to economical growth of a city means that there are some influences of global politics legacies. The debts of these countries call for the IMF provisions for restructuring the economies. Despite the handouts, the urban unemployment statuses continue in the third world countries.
In some countries that experience negative GDP growth, the urban populace is still high due to the IMF’s enforcement policies to support deregulation of the agricultural sectors, by accelerated provision of surpluses, thus the exodus of rural labour force.
In line with Davis’s writing (2006), there are global forces that push people from the countryside to the urban sectors such as mechanization, food imports, civil wars and drought. Consolidation and mergers of small business to large enterprises and the business competitions for industrial growth are major causes of urbanization even when the economy is weak and countries are heavily indebted.
The IMF, World Bank, WTO and other financial institutions are highly pushing for the structural advancement and growth in the urban centres. The institutions provide the implication that the root cause of the poverty-infested slums has a close connection to governance styles.
According to the IMF reports on the increase of slums in urban centres, globalization and inequality are not the causes of the over-populated slums but poor governance. The structural adjustment programs funded by the IMF are rather neoliberal due to the constant increase in urban slums and thus the cause of poverty. The funds continue to weaken the efforts of the urban elutes to support growth.
One would consider the logic behind the IMF slum structural adjustment program to be restoration of the economy especially in support of the underprivileged majority in the urban centres, but the results is an increase of populations at the centres and brain drains to rich countries. The restructuring adjustments by the IMF and World Bank were a source of displacement for the most urban populace whose destiny was the slums.
According to Davis (2006), considering all he countries the IMF/World Bank offers financial guarantee or assistance, the economy of the poor country succumbs due to devaluation, elimination of the import modus operandi, privatization related issues, enforcement of cost recovery measures especially in the health or education sectors and, food subsidies. These features are all measures that downsize the public sectors.
Conclusion
Is the poverty and slum life becoming a common phenomenon in developing countries? Are the uncontrolled governance and funding for the urbanization by the financial institutions from the well up countries the root causes of the situation? There is a steady alarming rise of the urban population in comparison to the general growth rates. The effects are now traceable to the rural poverty, social problems, governance complexities, violence, insecurity, and poor services provisions.
Reference
Davis, M. (2006) Planet of Slums, London, UK: Verso Publishers, Print
The current social situation in United States suggests that the notion of racial differentiation is extremely important. Indeed, division into social groups in accordance with race is a common phenomenon in educational establishments, workplaces, and in routine life in general.
It determines people’s way of life and attitudes of others towards them. However, is such differentiation justified? In his article “It’s Class, Stupid!” Richard Rodriguez managed to prove the existence of another, more objective criterion for social groups’ differentiation, which is wealth level.
One of the main issues of the author’s concern is color of skin as the most significant factor for living in American society. Rodriguez gives a lot of evidence for this idea, using elements of exemplification in his article. For instance, the author mentions the American writers, who “are brilliant at describing what it is like to be a racial minority” (Rodriguez, 1). Using such irony, the writer clarifies to the readers his position, showing that he disapproves such preoccupation of his nation with race differentiation.
In contrast to the existing way of social distinction, the author offers an alternative one, which is dividing people into rich and poor. He introduces the notion of “poor whites” (Rodriguez, 1), in order to prove that not only black people suffer from social inequity.
Rodriguez names numerous cases, which show the relevance of such reevaluation of society. Specifically, he tells about poor whites, who are willing to study, but who have no other choice but finding a “dollar-and-cents job working at Safeway or McDonald’s”, due to the financial state of their family (Rodriguez, 1). Thus, Rodriguez proves that material comforts or their absence are more important than belonging to a certain racial group.
Moreover, Rodriguez insists that subdivision of society into classes is a more objective way of social differentiation. The author emphasizes, “poor whites do not constitute an officially recognized minority group” (Rodriguez, 1).
Therefore, the writer encourages Americans, focused on racial narrow-mindedness, to extend their limits of society perception and admit the existence of social classes. What is more, Rodriguez mentions European society as the one, where the acknowledgement of lower social groups is progressing, setting an example for Americans. This proves the rational nature of author’s ideas.
It is worth mentioning that Rodriguez uses a persuasive tone in his argument. One of the evidences is the use of irony and sarcasm in the article: “Our only acknowledgment of working-class existence is to wear fashionable working-class denim” (Rodriguez, 1). The other feature of persuasion is the use of such lexical units as “sneer”, “rednecks”, “trailer-park trash”, etc. (Rodriguez, 1).
In addition, the writer uses a deductive type of discourse, developing his ideas from general statements to specific examples. Such tools help the writer to express his opinion more clearly and influence the readers. The main target emotions that are to be caused are shame, self-consciousness, and compassion.
All in all, the article of Rodriguez is aimed at showing the division into rich and poor more adequate than the division into black and white. Thus, the article discusses an important and topical social issue, which proves its usefulness. The author uses various techniques in order to prove his idea; he presents evidences of his own experience and of world famous cases, which support his point of view. The author is rather successful at persuasion, and his article is very educational.
The quality of one’s future after retirement primarily depends on the amount of savings or wealth they accumulated during their early working days. Therefore, because of the unpredictability of the economy, proper planning for retirement is one of the primary things that every American citizen should endeavor to do, because failure to do this can be very detrimental to one’s quality of life after retirement.
As compared to the past when it was simple to approximate the amount of funds that were necessary to sustain individuals throughout their old age, currently, the instability of the economy has made this task almost impossible, as result of the ever-changing cost of living.
Over the recent past, prices of essential commodities, transportation, health and primary care has risen drastically, and because likelihoods of this trend persisting to the future is high, it becomes important for individuals to adopt better saving options for their retirement. Although there are many schemes of saving for retirement, most Americans have put their entire hopes on social security as their primary way of saving, with little consideration of its shortcomings.
The stability of social security scheme has been one of the most debated issues by the elite class, because of its deficits in meeting all its clients’ retirement needs. For example, as research studies show, social security only caters for approximately 60% of an elderly person’ needs; hence, heavy reliance on this program can greatly jeopardize one’s quality life after retirement, if they solely depend on only this program’s funds (Pond, 2010, p.1).
Considering this, it is important for workers to reformulate their retirement saving plans, by starting to save early and adopting new and better saving plans, which will give them an opportunity of accumulating real wealth that is enough to cater for their retirement needs.
Why Save for Retirement starting from Now
In formulating retirement plans, most individuals primarily target particular retirement ages, with little consideration of the fact that, likelihoods of uncertainties occurring, which may force them to retire early are high.
In addition, with the current economic situation, regardless of the reliability of the method used to approximate the amount of savings that individual will need for their life after retirement, most of these methods never account for the numerous economic changes that may alter the an individuals spending habits, amount of expenses, and general lifestyle.
In any economic situation, because inflation is inevitable, failing to cater for economic uncertainties that are likely to occur in the future, hence save enough funds to cater for them, can greatly jeopardize a retiree’s life.
This makes it necessary, for individuals to start saving immediately after they start working, it being one of the primary methods of ensuring they would have saved enough for retirement, incase they are weak or not able to work during their late adulthood ages.
By 2003, as indicated by research studies, approximately two out of five retirees accepted to have retired early than they had anticipated, because of health complications, effects of economic crisis that faced their organizations, work problems, and change in career plans.
As the result of these reasons, the credibility of social security scheme is questionable, because the amount of accumulated funds from the program depends on how long an individual works, making it hard to rely on it sorely (Sondergeld, Greenwald & Rowland, 2005, pp. 6-15).
Social security is a state managed program; hence, although it can be a promising method of saving, like any other governmental program it can go into bankruptcy. If this like an occurrence occurs, most retirees who saved sorely through the scheme or who sorely depend on the scheme are likely to suffer in poverty or struggle their entire life searching for ways of sustaining themselves.
Another thing that makes the social security program to be an unreliable anti-poverty and retirement scheme is the nature extreme of influences of politics on its running.
Majority of the policies that run the American social security program are politically driven; hence, largely, this program rarely takes into consideration the amount of struggle the ordinary citizen has to go through in the endeavor to save for retirement. This makes it necessary fro individuals to embark on the process of saving for their future immediately they join the workforce by adopting good saving schemes that are reliable and accommodate the type of lifestyle every American, regardless of their socioeconomic status.
A good saving plan should not limit or penalize any member of the society, but rather it should offer them good returns for any amount of funds saved; funds that can enable individuals to sustain themselves and their family needs throughout their lives (Benson, Blendon, Brodie, & Wainess, 1998, pp. 3-9).
As research studies show, although majority of the elderly Americans get more than fifty percent of their funds from their social security funds, as compared to private and capital investments, earnings from this program are far much below amount that individual should get from their savings.
Further, unlike other saving schemes that leave an individual with the freedom of deciding how much to invest for their future, social security being government-controlled program gives the government the power of deciding the amount of tax citizens should pay, with little consideration of their socioeconomic status.
Considering this, it is important for individuals to analyze critically their future retirement needs, adopt good saving plans immediately the start working, because of the numerous uncertainties in one’s life (Tanner, 2000, pp. 1-6).
In addition to the numerous flaws of the social security program and uncertainties that may occur in one’s life, the ever-improving quality of life sustaining opportunities have put many individuals to the longevity risk. Due to this risk, most traditional retirement saving methodologies do not offer the required confidence of a bright future after retirement.
As research studies show, although still some employers have maintained the traditional methods of saving for retirement and giving of retirement funds, new methodologies have come into practice, for example, the cash balance from of plans. Yes, although these forms offer employers an opportunity of getting their savings in lump some amounts, economically, this a risky method, as it places the entire role of saving and managing retirement benefits to workers.
It is important for individuals to note here that, although individuals may have enough to save for retirement, majority of individuals underestimate their life expectancy; hence, unless one adopts a good saving plan during their working times, likelihoods of only social security funds supporting their retirement needs are low.
This is the case primarily because; the more an individual lives the more their health, basic, and other life sustaining needs increase. At this point, some individual may argue that, Medicare or Long-term Care Insurance (LTCI) can cater for their retirement needs.
Although this might be the case, most individual never consider the costliness of these programs, because after retiring there is no employer-based support that can cater for any deficits. Therefore, to avoid any resource deficits, it is important fro individual to save in plans that can guarantee them that; they will receive continuous income, necessary to cater for the numerous old age needs, when many sources of income hardly exist (Actuarial Foundation, 2010, pp. 47-50).
Conclusion
In conclusion, considering the numerous hitches that the social security program faces in providing individuals with all their old age needs, and the fact that, majority of elderly individuals hardly have any other source of income apart from their savings, it is important for individual to save in real investments. Such should be the case right from the time one joins the job field, because many economic, health, and social uncertainties can make individuals loose of or drop out of their jobs; hence, putting their future at stake.
Reference List
Actuarial Foundation. (2010). getting ready: what you need to know about annuities. Web.
Benson, M. J., Blendon, R. J., Brodie, M., & Wainess, F. (1998). America in denial: the public’s view of the future of social security. The Brookings Review. Web.
The issue of poverty is a never ending topic of discussion all over the world. This is even true in a supposedly rich country like the United States of America. This is my observation as I scan the daily newspapers, watch the six o’clock news and listen to my neighbors when they have nothing else to do but talk about life and politics.
It is very important topic of discussion because poverty is something that many of us would not want to experience. At the same time when we talk about poverty we also talk about the other side of the coin, which is, riches and comfort.
People from all walks of life, from the high and mighty to the poorest of the poor are affected by impact of extravagant wealth and staggering poverty. Economists, politicians, diplomats, entrepreneurs, employees, speculators, scholars, and even blue collar workers never cease to talk about poverty. However, there is no agreement when it comes to the root cause of these problems. It must be pointed out that poverty is caused by inequality.
Poverty and inequality go hand-in-hand and in order to eradicate poverty then we need to deal with inequality. Now, here is the problem, I find it difficult to simplify inequality. For example a poor person in the United States is better-off if compared to someone who struggles in a Third-World country. Inequality on the other hand is the same tricky problem. Minorities are citizens of this country but sometimes they feel as if they are second-class citizens and unable to access to resources that are open most Americans.
In order to simplify the discussion I would like to focus on some of the aspects of inequality that is familiar to me. Therefore, I would like to focus on social mobility, access to health care, the right to education, and the right to eat nutritious food.
In my opinion it does not matter where you live in the world, whether you are a European living in the trendiest cities or a citizen of Third-World country living in squalor, if you do not have access to the things that I mentioned above then you have experienced inequality and if you look around you the presence of inequality in society is the root cause of poverty.
In the January 22nd issue of The Economist for 2011, there is an article entitled the Inequality: The Rich and the Rest and the author said that inequality exists because of the lack of social mobility (The Economist, 2011, p.1).This is true but there is a need to elaborate on the issue of social mobility.
Thus, the lack of social mobility is the existence of social obstacles that prevent a person from getting the best job etc. I believe in this statement and I should say that the focus should be on quality education. In a progressive country like America the door swings wide open for college graduates. If the percentage of young men and women who can afford to go to college will significantly increase then there will be less inequality in this nation.
One of the main focuses of the Davos meeting is the growing gap between the rich and the poor. It insists that the widening gap is a global risk for the global economy (Koss & McArthur, 2011, p.1).
However, there is no consensus on how to solve this problem. Different leaders have different opinion on how to deal with inequality. Warren Buffet for instance made the suggestion that the rich need to be taxed more. Mr. Hu Jin Tao of China on the other hand wanted to focus on creating “harmonious society” by reducing the income gap between urban and rural families.
These are good ideas however, there is this article about poverty that made me realize that although it is perfectly alright to talk about this issue the fact of the matter is there are many people who are poor. According to the said article, “Almost half the world – over 3 billion people – live on less than $2.50 a day” (Shah, p.1). The ideas given by world leaders will help but something has to be done at the earlies possible time.
As mentioned earlier inequality exists because of the lack of social mobility, lack of education, non-access to health care, and the inability to buy nutritious food. This article provides the explanation why. There income levels are low in many countries. According to a report from Stanford University inequality exists everywhere.
There is even no need to travel beyond the borders of the United States because in this country “the top 1% of Americans control 23.5% of all the country’s income” (The Stanford Center for the Study of Poverty and Inequality, p.1). This is why increasing income inequality must be addressed soon.
Finally, inequality exists because the poor can no longer afford nutritious food. This means that they are prone to sickness and diseases, malnutrition and other related problems. If poverty can be addressed by dealing with inequality then how can poor families improve their standard of living if they cannot even eat a simple meal?
It is true that a wide income gap is the root cause of inequality and that inequality is the root cause of poverty. In the beginning of this discussion it was not clear how I can understand the real problem pertaining to poverty. But as I went through the various information and data with regards to poverty a clear link between poverty, inequality, and income was made.
The problem about poverty is urgent. But global leaders are not in agreement on the things that they need to accomplish to combat poverty and its effects. I believe that they should focus on the issue of inequality when it comes to income levels. They must try to understand how they can set things right. Good jobs must be provided and this is only possible if there is a government that can regulate these changes.
Conclusion
One of the best ways to deal with poverty is the creation of jobs, the rise of entrepreneurs who will provide jobs, the establishment of a prudent and reliable government to sustain the changes made. It by narrowing the gap between the rich and the poor that one can effectively deal with inequality.
If inequality is addressed then the poor will now have access to education, health care, and nutritious food. If the poor will have access to these things then it means that they can compete with the rest. They will have a chance to turn their lives around. But as long as inequality exists there is no way for them to break free from the bondage of poverty.