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
In July 2016, a young black male named Philando Castile was fatally shot by police officer Jeronimo Yanez outside of St. Paul, Minnesota during a traffic stop due to a broken tail light. Continue readingArts & CultureEconomicsHealthScienceSocial StudiesU.S.UncategorizedWorld
With the combination of a failing economy and rapidly inflating food prices, many Venezuelans are currently starving to death. One recent study found that in the past year, 75 percent of Venezuelans lost an average of 19 pounds. The proportion of children who suffer from severe malnutrition increased by four percent in just four months. Continue readingArts & CultureEconomicsHealthScienceSocial StudiesU.S.UncategorizedWorld
After weeks of drafting in secret, Senate Majority Leader Mitch McConnell (R-KY) made the Senate version of the health care bill public on Thursday morning. It shares broad strokes with the House of Representatives bill, whose approval rating is underwater. Continue readingArts & CultureEconomicsHealthScienceSocial StudiesU.S.UncategorizedWorld
After spending weeks drafting a bill to repeal and replace the Affordable Care Act behind closed doors, Republican leaders in the Senate announced that they would release it to the rest of the Congress and the public on June 22, 2017. Continue readingArts & CultureEconomicsHealthScienceSocial StudiesU.S.UncategorizedWorld
An extreme heat wave is currently affecting the western and southwestern United States. Continue readingArts & CultureEconomicsHealthScienceSocial StudiesU.S.UncategorizedWorld