Pace Perspectives

  

The disparity in wealth between the rich and the poor in today’s United States—often referred to as income inequality—has been the subject of much debate lately and is likely to continue to be for years to come. We recently asked some members of the Pace academic community to comment on it from their own perspectives.

The Prose and Poetry of Income Inequality
By Joseph M. Pastore Jr., PhD, Professor Emeritus in Residence
Lubin School of Business 

For its Summer 2013 issue, Pace Magazine courageously called upon me to describe the University’s recent focus on themes of “justice” and “class.” Each was evident in the Common Reading Program for First Year Students. And, each is palpably evident in our national discourse as I write this piece and bear witness to a U.S. government shutdown and budget stand-off linked largely to the income inequality debate over The Affordable Health Act, a.k.a. “Obamacare.”

When it comes to data-driven insight on matters of income inequality, the recent Census Bureau report on household income calls renewed attention to two documented conditions: the average income for a U.S. household today is about where it was 25 years ago—thus a decline in income when inflation is factored in—while our nation’s per capita wealth has increased 40 percent over that same period of time.

So who is reaping our national income? No surprise. We’ve witnessed poetic verses in our Zuccotti Park backyard while prosaic reports reveal that 50 percent of our nation’s income is going to the richest 20 percent of our population, leaving, of course, the remaining 50 percent of our national income to 80 percent of our population. Some say, that’s always been the case. Read Dickens’ Tale…

But “always been the case” is a descriptive ethic, not a prescriptive ethic. The Census Bureau report confirms, not ordains, what is. Despite our apparent wealth evidenced by a bounty of cars thanks to leasing and smart phones thanks to our obsession with social media, the poverty level is increasing and our middle class is dwindling at the same time the cost of healthcare and education—two key elements of a “good society”—are increasing at rates in excess of inflation.

So, what can we do? It’s at this point that humanists, and I like to think I am one, urge that the battle between one’s right for equality versus one’s right to freedom and the upside of inequality can be arbitrated only with a dose of virtue and a poetic call for the rich to redistribute wealth to the less fortunate. Prosaically, however, it is not until we come to understand no nation is sustainable without an economically viable, healthy, and educated middle class and, whether it is through income redistribution policies or increased economic opportunities, a declining middle class is the enemy around which a U.S. coalition to mitigate income inequality must be built.


The Affordable Care Act and Income Inequality
By Stephen Ferrara, DNP, RN, FNP-BC
College of Health Professions

As healthcare reform is underway in the United States, healthcare is one of the sectors where income inequality can have pervasive effects on an individual’s well-being. As providers, we readily acknowledge patients rationing their medications or avoiding the healthcare system altogether because they simply cannot afford it on a fixed or limited income. There is an abundance of evidence suggesting higher incidences of mortality and morbidity as a result of this disparity. The wealthier in our society have longer life expectancies than the poor.

One of the goals of the Affordable Care Act is to increase access to healthcare for the working poor and uninsured in our communities. We anticipate that the increased access to primary healthcare will promote enhanced healthcare outcomes, such as decreased rates of obesity, cardiovascular disease, and diabetes. However, access alone will not equate to better outcomes. We must innovate with new delivery models that focus on health promotion, better evidence-based disease management, and culturally competent care to achieve a healthier society.

There are significant knowledge gaps in the current body of literature between income inequalities and healthcare. While we realize that poorer individuals have increased morbidity, we do not fully understand why. Some experts attribute this to lower income individuals having a lesser understanding of health information, leading to worse outcomes. However, this overly simplistic view fails to capture the concept of health contributing to inequality. Future work in this field must focus on the relationships between health and income inequality.

 

The Morality of Income Inequality
By Farrokh Hormozi, PhD
Dyson College of Arts and Sciences

Recent census data is disturbing and headline news makes us wonder what is going on in this super economy of the United States. An article in The New York Times by Annie Lowery notes: “Household Income Remains Flat Despite Improving Economy.“ Despite soaring corporate profits and improved economic conditions, according to CNN, the average American suffered greatly in 2012.

Even though the average CEO has gotten 40 percent raise since 2009, the average American earns less than he or she made in the same year. We know we live in a two-tier economy, one where 400 of the richest people control the same amount of wealth as 150 million others. Soaring corporate profit only improved the wealth of the top 1 percent while that of the bottom 25 percent deteriorated hugely. In 2011, a study by Congressional Budget Office found that the top 1 percent of American households increased their income by 275 percent over a period between 1979 and 2007, compared to a gain of just under 40 percent for the 50 percent in the middle, and loss of 5 percent for the bottom 20 percent. In 2012 the gap between the richest 1 percent and the remaining 99 percent was the highest since the 1920s.

What is the social implication of an income gap of such magnitude? The answer depends on one’s ideological assumptions. From one perspective, an income gap is good for the free market economy because it forces us to work harder and push ourselves up the income ladder. From another perspective, income inequality has undesirable socioeconomic consequences. People who share that perspective believe in some disequilibrium in the income gap but rely on John Rawls’s social justice doctrine: “Social and economic inequalities…are to be to the greatest benefit of the least-advantageous members of the society.” And further to the left, according to George Packer, “Inequality hardens society into a class system … Inequality divides us from one another in schools, in neighborhoods, at work, on airplanes, in hospitals, in what we eat, in the condition of our bodies, in what we think, in our children’s futures, in how we die. Inequality makes it harder to imagine the lives of others.

The space here is not enough to pursue the argument fully, so let me, in the spirit of John D. Sutter of CNN, pose some questions or topics for further discussion. You may want to bring them up socially or at the dinner table, but don’t ruin your dinner over it:

  • Inequality is not a moral problem, opportunity is.
  • Inequality is not bad, but the size of the gap matters.
  • In Biblical tradition, it is wrong to hold too much wealth.

 

A Day in Equity Academy
By Mary Rose McCarthy, PhD, and Tom Liam Lynch, EdD
School of Education

The results of the most recent New York State examinations remind us once again that differences in family income result in differences in educational outcomes. With a very few exceptions, the average scores in schools that serve poor children are much worse than the scores in schools that serve children from wealthy families.

One extreme example is a comparison between the outcomes in the Rochester School District and the neighboring district of Pittsford. In Rochester, where 88 percent of students receive free and reduced-price lunches, only 5 percent were deemed proficient on the tests. In Pittsford, where 4 percent receive free and reduced-price lunches, over 60 percent were deemed proficient.

Current education reformers muffle the consequences of income inequality by hollering words like achievement, transparency, and choice and attempting to persuade the public that their efforts will overcome the differences in educational outcomes between rich and poor children. The reality makes those claims questionable.

Imagine a school in Big City called Equity Academy —a new small school in which enrollment is chosen by families. Such schools are promoted as ways to make academic outcomes less dependent on family income; however, the reality does not live up to the promise. Equity Academy was established with little time for planning; its principal was prepared in an express-track leadership program, and most of its teachers have little or no experience in public schools. The school was publicized only briefly prior to the lengthy school selection process that families must negotiate and which is more easily done by parents with higher literacy levels, economic status, and cultural capital.

If students require special services or English language classes, they will not be accepted into Equity. If they are accepted, they have to travel for more than an hour from their low income neighborhood. If they are of non-white appearance and male, they experience ubiquitous searches by law enforcement. If they qualify for free and reduced lunch, they receive meals that are as unhealthy as they are unappetizing. Internet access in the school is shoddy, the infrastructure old.

A computer lab, if it is available, is reserved for students who need to recover credits, for which the school has purchased specialized online courses to “teach” students content—a not uncommon practice that New York State audited and reproved last year. Teachers are under-resourced to provide the supports students need. Students who don’t achieve graduation in a timely way are counseled into one of the city’s GED-style programs and no longer included in measurement of the district’s graduation rates. Those who do graduate from Equity Academy in four years can expect to take remedial courses in college. During their school careers, their principal will leave to take a handsomely paying private sector job and their teachers will transfer to other schools and districts.

These, sadly, are realities in our fictional Equity Academy. It isn’t that reformers are not saying (and often believing) they are addressing issues of inequity. It is that they don’t reflect closely, critically, or long enough to understand that their definition of achievement doesn’t mean life-long learning, transparency doesn’t mean fairness, and choice doesn’t mean freedom. And their kind of reform adds to the negative outcomes of income inequality.

What do you think? Let us know at URnews@pace.edu.

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