The Impact of Class Structure on the US Economy

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The present situation in America is such that there are two classes of its citizens, the taxpayers, who pay for the services provided by the government, and those who do not pay federal income tax. The number of freeloaders in the year 2009 was found to constitute 47% of Americans (Nyhan 1). 40% of the 47% who do not pay income tax are provided with benefits and cash by the government, which comes from the taxpayers. These cash handouts are in the form of unemployment benefits, housing subsidies, welfare, child tax credits and other programs. On the other hand, about three-quarters of the federal income tax comes from the top 10% (Nyhan 1). So the question is, what factors have led to this current situation that takes money from the rich and gives it to the poor?

Could the budget-cutting climate that threatens public education and health programs lead to a widened gap? The reliance of middle-class families on early education support and public health care has been on the rise since before the great recession. The family income in middle-class families was observed to drop by over $4,200 while that of better-off families fell by only $140, in the period between 2000 and 2008. The increased taxation and decreased income for the middle-class households would lead to a decrease in their federal tax, and more reliance on federal support. Their struggle to meet their family needs has contributed to a widened gap between them and the wealthier families (Nyhan 2).

Could the increase of single-parent families cause a wider gap? Research conducted over a period of more than fifteen years showed an increase of over 10% in the number of families led by one parent, from 14%. This implies an increase in the number of unstable families since the family income in middle-class families would be split in two, which in turn leads to reliance on public programs. This is an inhibitor to the growth of income, as they struggle to provide the basic needs increases (Schlafly 1). Is the location of a particular socio-class relevant to the opportunities available for employment? The chances available for employment for the middle-class are different from those of wealthier families. Most people in middle-class households rarely make it through high school. In order to contribute to the family income, they move through various odd jobs hoping to find a job with better pay and security. Without the necessary education, it is unlikely for these people to get good secure jobs, and are likely to end up in crime and drug abuse, which blocks their chances of financial growth (Schlafly 1).

Does the class structure affect the laws made? The laws are made to favor wealthier households or corporations that provide the middle-class with employment in the form of labor. These factories are at liberty to close down when they feel that their profits are insufficient, and open up in countries with lower-wage workers, without considering their workers or the communities (Schlafly 1). With such laws, the wealthy people have the right to take away the means of livelihood of people, in order to make profits. An example of such occurrences is the closed industries in Pennsylvania. The closure of these industries also affects high-wage workers, though their credentials can provide them with alternative good employment, unlike the low-income earners (Schlafly 1).

Policies are influenced and formulated by wealthy and powerful people. Employees are denied the chance to join trade unions since employers either break them up or prevent their founding. Does the prevention of workers by law, from striking a collective negotiation constitute their increasingly low incomes? American workers including farm laborers, house workers and low-level supervisors are not protected by law, and their social security and rights cannot be guaranteed (Perrucci and Wysong 1). The number of people without social security has continued to increase, with an approximate 16% lacking medical insurance. With the workers unable to engage in dialogue or demonstrations to express their demands due to fear of unemployment, they continue to survive with minimal income that is incapable of improving their living conditions (Perrucci and Wysong 2).

Is poverty itself a contributor to the increasing gap? The low income of middle-class families implies that they are unable to provide their children with good education, and the increasing college tuition fees inhibit the further studies of these children, which leaves them with limited employment opportunities, with low income (Perrucci and Wysong 3).

Works Cited

Nyhan, Paul. The Gap Between Middle Class and Wealthy Families Could Widen. 2011. Web.

Perrucci, Robert and Earl Wysong. “The new class society.” Miami: AIPI, 2006. 1-4. Print.

Schlafly, Phyllis. America Becomes a Two-Class Society. 2010. Web.

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