Daily Video

August 17, 2011

The Income Inequality Quiz

While they were waiting in line for tickets to the David Letterman show, NewsHour Economics Correspondent Paul Solman asked a random sampling of people to look at three pie charts representing how wealth is distributed in three different countries. In one country, everyone had an equal slice of the wealth; in a second, the rich had slightly more than others; and in the third, the rich held 84% of the total generated wealth. Solman asked people to guess: which one of these countries is the U.S.?

Although most people guessed that the middle pie chart represents wealth distribution in the U.S., the third pie chart, with the most income inequality, is the correct one. Economists say that most Americans don’t realize this inequality exists in their country because they rarely look beyond their own communities, which tend to be more homogeneous.

One high school student says she thinks it’s getting easier for wealthy Americans to ignore the income inequality because they insulate themselves from the rest of the population. However, when asked to identify the country they would like to live in based on the pie chart that represents its income distribution, most Americans chose the chart that represents Sweden.


“We had 7,000 people distributed around the U.S., different levels of income, education, wealth, political opinions — 92 percent of the Americans picked Sweden over the U.S. When we broke it by Democrats and Republicans, Democrat, it was 93 percent, Republican, it was 90.5 percent.” – Economist Dan Ariely

“Part of the success of the United States’ economy lies in the fact that, if you succeed in a big way commercially, you’re rewarded for that. And the taxes on your success are modest, say, compared to what they are in a country like France or in the Scandinavian countries.” – Economist Steven Davis

“We’re high for a poor country, in terms of inequality, and we’re a rich country. We’re about the same level of inequality as China. And, of course, China, half the population are rural peasants who are not part of the modern world.” – Economist Richard Freeman

Warm Up Questions

1. What is income?

2. What is the difference between ‘equality’ and ‘inequality’?

3. If you had to guess, what percentage of all the wealth in the U.S. is held by the rich? Is it closer to 0%, 50% or 100%?

Discussion Questions

1. Why might it be a bad thing to have a lot of wealth concentrated in the hands of a few people? Why do you think most people said they would prefer to live in a country where wealth is distributed more evenly?

2. Do you notice the wealth inequality in the U.S. on a day-to-day basis? How so? Why might it be hard to recognize it in your everyday life?

3. One economist in this video argues that the success of the U.S. economy depends on keeping taxes low and rewarding people for their success. Do you agree with that? Why or why not?

Additional Resources

Video Transcript

Understanding the Bush Tax Cut Plan

April Looms Large for American Taxpayers

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