The wealth inequality video

Wealth inequality in the United States, also known as the "wealth gap", refers to the unequal distribution of financial assets among residents of the United States. Wealth includes the values of homes, automobiles, businesses, savings, and investments. Those who acquire a great deal of financial wealth do so primarily through the appreciation of fiscal portfolios. For this reason, financial wealth involves only stocks and mutual funds, and other investments. Hence, there is greater financial inequality than simple net worth disparities. Various sociological statistics suggest the severity of wealth inequality "with the top 10% possessing 80% of all financial assets and the bottom 90% holding only 20% of all financial wealth." Although different from income inequality, the two are often interrelated. [1]

The video has sparked considerable criticism as well, since it does seem elaborately designed to arouse commotion (excellent, simple fluid graphics, deep reassuring voice for the narrative, etc.). Read some articles in Forbes here and here. Since the time the video has gone viral, the accumulated views, range in the millions, but it is still not clear who produced it, and it is clear that no solution is being proposed to the “problem” of wealth inequality identified in the video. The video does seem posed to influence you with emotional arguments, hence bordering the area of “marketing material”. Read some more counter-arguments here and here.

The Wealth Inequality in America infographic video was posted on YouTube back in November 2012. The video is a good example of what the best infographic designs accomplish. The data sources are clearly listed at the end of the video, though it’s not clear who created and is publishing the video. The account seems to have been created for just uploading this video. Well, if you wish to know more, then here you will find background info on the viral infographics presentation video

But what a wonderful coincidence it is, that at the same time a documentary titled “Inequality for All” was an unexpected hit at the recent Sundance film festival, arguing that US capitalism has fatally abandoned the middle classes while making the super-rich richer. Inequality for All looks at the topic of widening income inequality through the eyes of noted economic policy expert Robert Reich. At the heart of the film is a simple proposition: what is a good society, and what role does the widening income gap play in the deterioration of our nation's economic health ? The creators aim for the documentary-film to be a paradigm-shifting, eye-opening experience for the American public (and not only, I guess) ; to accurately show through a non-partisan perspective why extreme income inequality is such an important topic for US citizens today and for the future of America. Visit the documentary’s info website here. Read more on the film’s impact here.

Furthermore, some points I would like to put forth :

Wealth or income should not be the only indices denoting inequality. Let’s consider for a minute housing or education, or access to public amenities, infrastructure or services. There are numerous factors determining the equality of a populace, and a number of them when measured can be used as indicators. So we should not limit ourselves to monitoring wealth distribution (although housing or education, for example, can be included in the equation as realised expenditure) in order to determine equality, and in even populace happiness or satisfaction.

Of course one should not neglect to analyse what comes after, i.e. as a result from the observed wealth inequality. Just to raise a single point, you should not take for granted the course that people take in order to get in public office. It is definitely not a coincidence that people with more wealth, have a “louder”, or “more frequently heard” voice.

It is apparent that what is presented here, with US collated data, is applicable to the rest of the world, in either similar or grossly exaggerated fashion ; but the truth remains that it is applicable. And of course, in turn the big fish subjects to the same model the smaller fish, and it will go on and on indefinitely unless people are willing to change it. But that again seems to be unattainable. Unfortunately in that case, we do not select what we are born into. And please don’t tell me that it’s all a matter of your choices or effort, because if you were born into a ravished central African family, the chances of you being the future president of a conglomerate are rather “slim”.

Hence a popular argument, that states that “It always has been that way, it so is, and so shall it continue to be in the future”. Well, I do dislike to disappoint you, but that is not the truth. There have been notable periods for the now so called Western World, that wealth inequality (or inequality in general) was not the case. The same is even more true for the rest of the world.

NOTES [2] :

Generally speaking, wealth is the value of everything a person or family owns, minus any debts. However, for purposes of studying the wealth distribution, economists define wealth in terms of marketable assets, such as real estate, stocks, and bonds, leaving aside consumer durables like cars and household items because they are not as readily converted into cash and are more valuable to their owners for use purposes than they are for resale. Once the value of all marketable assets is determined, then all debts, such as home mortgages and credit card debts, are subtracted, which yields a person's net worth.

Economists use the concept of financial wealth which is defined as net worth minus net equity in owner-occupied housing. Financial wealth is a more 'liquid' concept than marketable wealth, since one's home is difficult to convert into cash in the short term. It thus reflects the resources that may be immediately available for consumption or various forms of investments.

There is a difference between wealth and income. Income is what people earn from work, but also from dividends, interest, and any rents or royalties that are paid to them on properties they own. In theory, those who own a great deal of wealth may or may not have high incomes, depending on the returns they receive from their wealth, but in reality those at the very top of the wealth distribution usually have the most income. It is important to note that for the rich, most of that income does not come from "working" as we the rest perceive it.

[1] Ref. http://en.wikipedia.org/wiki/Wealth_inequality_in_the_United_States

[2] G. William Domhoff, “Wealth, Income, and Power”, http://www2.ucsc.edu/whorulesamerica/power/wealth.html

[3] more Infographics http://www.motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph