Daily VideoAugust 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%?
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?
Tooltip of related stories
Tooltip of more video block
Submit Your Student Voice
Hillary Clinton and Donald Trump faced off Monday night in the first of three presidential debates leading up to this year’s election on Nov. 8. Continue readingArts & CultureEconomicsHealthScienceU.S.UncategorizedWorld
The practice of drawing congressional district lines to benefit one political party over another is known as gerrymandering and dates back to the 19th century. Continue readingArts & CultureEconomicsHealthScienceU.S.UncategorizedWorld
As Election Day approached, the candidates running for president have made and effort to appeal to parents, teachers and students by showing them where they stand on education.Arts & CultureEconomicsHealthScienceU.S.UncategorizedWorld
Following pipe bomb attacks over the weekend, the presidential candidates each took a moment to assure voters of their national security qualifications. Continue readingArts & CultureEconomicsHealthScienceU.S.UncategorizedWorld
Hillary Clinton had to stay home in order to recover from pneumonia this week, but that didn’t stop her campaign.Arts & CultureEconomicsHealthScienceU.S.UncategorizedWorld