The Instigator
mrboyertown
Pro (for)
Winning
28 Points
The Contender
twsurber
Con (against)
Losing
12 Points

Income inequality does not equal economic inequality

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Voting Style: Open Point System: 7 Point
Started: 11/3/2009 Category: Society
Updated: 7 years ago Status: Voting Period
Viewed: 2,512 times Debate No: 9888
Debate Rounds (3)
Comments (1)
Votes (7)

 

mrboyertown

Pro

Despite rising levels of income inequality within the United States, real standards of living have become more equal. While it is true that disparity between incomes is on the rise, the gap between our actual standards of living have remained relatively unchanged, and have even improved. Measurements of income inequality produce distorted pictures of actual economic equality. Anyone interested in refuting this argument is welcome to try.
twsurber

Con

My opponent's case:

Sentence 1: Standards of living have not become more equal, to the contrary, they have moved further apart. As the adage goes, "The rich get richer, the poor get poorer". Further, a source from inequality.org states: Our current financial crisis and the subprime crisis are both symptoms of a larger economic problem: an economy that no longer sustains a middle class and instead, allows the wealthiest elite to gamble massive fortunes regardless of its possible impact. Historically, what has made the US economy strong has been an economy that fed and strengthened the middle class. Over the last 30 years we have seen the American economy go in the wrong direction. Instead of a growing and prosperous middle class, wealth has become concentrated in the hands of the rich, leaving middle class and working class America cash poor.

Sentence 2: My oppoenent has contradicted himself in this sentence. Have they remained relatively inchanged or have they actually improved? Which is it? I extend my counter quotation from sentence one.

Sentence 3. This is an unsubstantiated opinion with no supporting evidence.

Sentence 4: I would like to thank the Pro for offering this opportunity.

My case:

Contention 1: The growing disparity between incomes disenables the lower earners to spend as much. As the cost of goods and services increases, the value of monies earned by the lower earners decreases. Because fewer goods and services can be purchased due to the diminishing purchasing power, the GDP/GNP will ulitmately suffer. Each generation lives longer than the last, doesn't it? Well, yes, that's true for most people in most places. But it hasn't been true lately in large areas of the United States - the poorest areas, basically. Between 1983 and 1999, life expectancy declined among women in more than a quarter of all U.S. counties (and among men in about 3 percent of all counties). That fact could be linked to growing economic inequality, Elizabeth Gudrais suggests. "Disparities in health tend to fall along income lines everywhere: the poor generally get sicker and die sooner than the rich," she explains. "But in the United States, the gap between the rich and the poor is far wider than in most other developed democracies, and it is getting wider."

Contention 2: Income inequalities vs Economic inequalities are far more reaching than a simplified solution. The relationship between income (and other resources) on the one hand and individual achievements and freedoms
on the other is not constant. Different types of contingencies lead to systematic variations in the conversion of incomes into the distinct functionings we can achieve (i.e., the various things we can do or be), and that affects the lifestyles we can enjoy. There are at least five important sources of parametric variation. (1) Personal heterogeneities, (2) Environmental diversities, (3) Variations in social climate, (4) Differences in relational perspectives, and (5) Distribution within the family.

To summarize, there are factors which make income inequality relational to economic inequality.
Debate Round No. 1
mrboyertown

Pro

Despite rising levels of income inequality within the United States, real standards of living have become more equal. While it is true that disparity between incomes is on the rise, the gap between our actual standards of living have remained relatively unchanged, and have even improved. Measurements of income inequality produce distorted pictures of actual economic equality. Anyone interested in refuting this argument is welcome to try.

My opponent's case:
In response to my opening statement my opponent states that standards of living have not become more equal but have moved further apart. To support this claim he states that the growing disparity between incomes disenables the lower earners to spend as much. I agree. He then immediately follows up with the statement that as the cost of goods and services increases (inflation), the value of monies earned by the lower earners decreases. I agree, even though that's only half the truth. In actuality, everybody's money experiences a decrease in purchasing power whether your rich, poor, or in the middle. To be honest I agree with just about everything my opponent has written, nonetheless, he still fails to prove his opening statement that standards of living have declined.

Contention 1 covers inflation and health trends for those that are poor. Well yes, it's common sense that those who can afford better health care are generally in better health. The rich have better health care than the poor and that's a fact, no argument. However, even though we all know that the rich get better health care, are the poor receiving worse care than during previous time periods? This is my debate. I argue that the poor are receiving better health care today, due to many of the technological and pharmaceutical advancements, than they did 10-20-50-100 years ago. In my book, that's a rise in the standard of living.

Contention 2 is slightly confusing. First sentence: Income inequalities vs. Economic inequalities are far more reaching than a simplified solution. I'm really not looking for a solution, in fact, inequality whether economic or income related, creates incentives. If everything and everybody was equal, who would want to go through law school or medical school? If I could get the same pay for working at McDonalds as anywhere else, what would make me want to go through years of extra schooling to join a profession with high levels of stress for the same pay? But this is beside the point and completely off topic. The remainder of contention 2 lists five important sources of parametric variation. This is where you totally loose me. Are you stating that everybody in America does not have the privilege to start from the same level of social status due to these variations? If so, I agree. The great thing about America is we have the highest levels of income mobility. Just because you're poor doesn't mean you have to stay poor. In fact, "according to a U.S. Treasury Department study of American taxpayers, about half of those in the lowest income group when filing their tax returns in 1996 moved into a higher income category by 2005. Twenty-five percent moved into a middle- or upper-income group, while more than 5 percent moved into the highest quintile." If you were implying something different when mentioning parametric variations, I apologize. Once again though, we are totally off topic. These statements in no way, shape, or form support your argument that standards of living are declining.

My Case:
My case is very simple and easy for everybody to understand. I restate my argument to clear any misunderstanding – Despite rising levels of income inequality, gaps between our actual standards of living have remained relatively stable and have even improved. And yes I could have reworded that statement in a more concise manner, but let me explain so as not to contradict myself. The gap, or difference, of living standards between the poor and rich has remained stable. While this gap has remained stable, levels for standards of living have been rising.
Evidence:
From an article, Aren't the Rich Getting Richer at Other People's Expense, posted on Forbes.com -
•"In 1985, 38% of poor households owned a home--by 2005 it was 43%. And these homes were of better quality than the 1985 homes. In 1985, 17% of these homes had central air conditioning, and in 2005, 50% did.
•Fifty-six percent of homes owned by poor households had washing machines in 1985, and in 2005, it was 64%."
•"Many people who are today labeled as "poor" by the U.S. government actually have a higher living standard than those above the poverty line in the 1960s and '70s."
•"In 1999, nearly 36 percent of all ‘poverty level' African American households had central air conditioning--well over twice the figure for America's white non-poverty population in 1970."
•"According to the Census Bureau, over three-quarters of a million "poor" persons own homes worth over $150,000; and nearly 200,000 "poor" persons own homes worth over $300,000. These numbers do not reflect the hundreds of thousands of people who became homeowners during the subprime binge of 2004-2006. Even with substantial defaults of these particular mortgages, the fact remains that hundreds of thousands of supposedly poverty-stricken people owned valuable homes." ……and the list goes on.

To summarize, while there are factors which make income inequality relational to economic inequality, these relationships are weak and income inequality remains a poor measurement of actual economic inequality in terms of standards of living. I patiently await my opponents rebuttal.
twsurber

Con

My opponent would have us believe that as the value of a dollar gets weaker, and the costs of goods and services gets higher, the window between the haves and have nots remains at least the same if not improves. This cannot be.
I will concede three constants:
1) The dollar held by a rich man equals the dollar held by a poor man
2) The rate of inflation experienced by a rich man equals that of a poor man
3) Rich men do have more dollars to spend then poor men

Unfortunately, there are a disproportionate number of poor men to rich men. The money spent by rich men does not offset the lack of money spent by poor men. The larger number of poor we have, the less they can contribute to the GDP.

UNEMPLOYED:
The unemployment is the highest it's been in some time: "In October, the unemployment rate rose to 10.2 percent, the highest since April 1983, and nonfarm payroll employment continued to decline (-190,000). (http://www.bls.gov...)

HOMELESS:
On any given night in America, anywhere from 700,000 to 2 million people are homeless, according to estimates of the National Law Center on Homelessness and Poverty. (http://www.policyalmanac.org...)

The sliding window is not proportionate. Word picture: It is not like riding in an elevator together.
Debate Round No. 2
mrboyertown

Pro

Once again my contender has failed to bring forth an argument which refutes my claims. What he has done with his rebuttal, is given you a list of facts and only facts – none of which provide any support for his argument claiming that increases in income inequality reflect increasing levels of economic inequality - as measured by standards of living.

Fact # 1 - Yes we have inflation, and yes rich people have more money to spend than poor people. I totally agree.

My opponent implies that because of inflation, poor people who have less money to spend will feel these effects more so than the rich, and therefore experience a greater decline in their standards of living. This sounds plausible and very well may be true. My only problem with this statement is that we've always had inflation in this country ever since we started using money. In fact rates of inflation have been much higher in years past. Just look at the 70's and 80's. The average inflation rate between 1974 and 1985 was 8%. In some years, it was much higher - such as 13.58% in 1980. What is 2009's inflation rate projected to be? As a matter of fact, it's projected to be 0%. Moreover, the average inflation rate between 1998 and 2009 has been a whopping 2.5%. Despite these varying rates of inflation, whether high or low, we still have managed to raise our standards of living, through innovation and productivity, for the poor and rich alike. Please refer back to my statistics and statements from round two. (All of these inflation statistics can easily be found on govt. websites.)

Fact # 2 - The unemployment is the highest it's been in some time: "In October, the unemployment rate rose to 10.2 percent, the highest since April 1983, and nonfarm payroll employment continued to decline (-190,000).

Here, once again, my opponent is stating a fact. But what does this fact do to help his argument, or more importantly, discredit mine? We are in tough economic times right now and there is no doubt about that. Rich people, poor people, and in the middle people are all feeling the crunch. So what does this mean? Many of us are adjusting our spending habits and for a lot of us that means less eating out, buying generic consumer goods, or for some of us, having to go with the Toyota over the Mercedes. Are these spending adjustments creating a decrease in our standards of living? Maybe, but those generic goods provide the same functions as name brand products with a little less flare. That Toyota will still get you from point A to point B with a little less style. My point is – we may have to temporarily downgrade in some areas of our lives; but, is this temporary downgrade substantially dragging down our standards of living? Furthermore, have you been to the mall lately, or your local car dealer, and how about Wal-Mart? Sales are going on like never before and businesses are slashing their prices. Buy one get one free deals are a dime a dozen - I've even seen those offers at car dealers!

Now for those who are truly unemployed, some companies provide severance packages and our federal government provides, and has extended unemployment benefits to help assist the jobless. In addition, many of the more needy families may qualify for further assistance through various other governmental social welfare programs. All of these social safety nets are in place to help sustain you and your family until you can find another job. For the truly unfortunate who are unable to find a job and eventually end up on the streets - well there is even some relatively good news for you to. Standards of living for the homeless are also on the rise, and this brings me to my next point.

Fact # 3 - On any given night in America, anywhere from 700,000 to 2 million people are homeless, according to estimates of the National Law Center on Homelessness and Poverty.

First I will ask this question – Do homeless people receive better care and have more opportunities to rise above levels of homelessness today, than they did 50 years ago? My research says yes! Homelessness is a sad fact, but did you know that –
• One of the most dramatic findings to emerge from the 1996 National Survey of Homeless Assistance Providers and Clients (NSHAPC) is the tremendous growth in the number and variety of homeless assistance programs during the late 1980s and early 1990s.
• A report created by the Congressional Research Service states that – Before the early 1980's, most homeless assistance took place at the local level, and was often considered to be ineffective. However, as advocates for the homeless achieved national attention for the problem of modern homelessness, the federal government played a greater role in responding to homelessness and created much more effective assistance programs.
• A 154 page inventory report produced by the U.S. Interagency Council on Homelessness covers in detail, over 73 federal programs targeting homelessness that are currently in operation today, many of which were not around as recently as 30 yrs ago.

As you can see, even the homeless are experiencing a rise in their standards of living and most of it is due to the comprehensive assistance programs the federal government has put into place to directly help this population of disadvantaged citizens. Let me be clear, I'm not claiming that this situation is all roses and peaches. What I am claiming, is that even the individuals who find themselves at the very lowest rung on the social ladder have been experiencing a rise in their standards of living as compared to fifty years ago.

In closing please allow me to leave you with two more facts to think about, which I believe, does my argument – that income inequality does not equal economic inequality – due justice.

Income inequality within countries is most often measured by a scale known as the Gini Coefficient. According to the Cato Institute of Economic Research –
"As measured by the standard metric, the Gini Coefficient, U.S. income inequality is about the same as in Ghana. If you believe that income inequality is a rough measure of the justice of a nation's social and economic institutions, then it would appear that the United States and Ghana are roughly on par. Yet the UN Human Development Index – a relatively comprehensive measure of average well-being – ranks Ghana 136th out of 177 nations, while the United States is ranked 12th…..This suggests that a nation's level of income inequality tells us very little….. Noting that a country's level of income inequality is high or low logically implies nothing at all."

Also from the Cato institute of Economic Research –
"When people talk about inequality, they tend to focus exclusively on the income part of the equation. According to all our measures, the gap in income between the rich and the poor has been growing. What Broda and Romalis quite convincingly demonstrate, however, is that the prices of goods that poor people tend to consume have fallen sharply relative to the prices of goods that rich people tend to consume. Consequently, when you measure the true buying power of the rich and the poor, inequality grew only one-third as fast as economists previously thought it did – or maybe it didn't grow at all."
twsurber

Con

FINAL REBUTTAL
1. My opponent states throughout this debate that I have given facts and that he agrees with practically everything I have posted. To that I say thank you.

2. In several of his own contentions I have identified contradictions. For example look at the very last sentence of one of his sources: "...inequality grew only 1/3 as fast....or maybe it didn't grow at all".

3. Indeed, the identification of economic inequality with income inequality is fairly standard, and the two are often seen as effectively synonymous in the economic literature. (Southern Economic Journal)

Summary: My opponent has complimented and agreed with my case while presenting a somewhat confusing case of his own. I respectfully request that you the readers vote CON. Thank you.
Debate Round No. 3
1 comment has been posted on this debate.
Posted by RoyLatham 7 years ago
RoyLatham
Studies show that once basic needs are met, increasing income does not make people happier. Basic needs include food, clothing, and shelter. Hence the whole obsession with making incomes more equal is completely misplaced. I suspect that North Korea is one of the most equal countries on earth; equality is easy to achieve by getting everyone very poor. what we should really be concerned with is getting as many people as possible the basic necessities. Doing that requires capital formation and investment, not redistribution of wealth to keep everyone poor. South Korea has greater inequality of wealth compared to North Korea, but it's not difficult to figure out which is a better place.

I think this point underlies Pro's position in the debate. The translation of wealth to well-being is not obvious.
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