Why is it That the Rich are Getting Richer and the Poor Poorer Short Summary

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There is currently a notable contrast between individuals from wealthy families and those less fortunate who grow up in poverty. The population is quickly growing, resulting in an increasing gap between the rich and the poor. This can be attributed to the American government’s focus on economic growth while neglecting support for people living in poverty. Oxfam’s “Globalisation” report emphasizes the negative impact of globalization on different social classes.

The authors of “Why the Rich Are Getting Richer and the Poor, Poorer” by Robert Reich analyze the causes of job loss, including cheaper labor in other countries and companies focusing on maximizing profit while minimizing costs. They emphasize three key factors that contribute to the wealth gap: globalization, growing inequality, and education’s significance. Globalization pertains to rapid economic integration influenced by trade liberalization, investment and capital flow liberalization, as well as advancements in technology and the “Information Revolution.”

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According to Oxfam (110), the process of global integration is progressing quickly due to the elimination of trade and capital barriers, as well as advancements in technology. Consequently, market entry has become more accessible, resulting in decreased costs for consumers and producers while fostering increased trade and cash flow among nations. Nevertheless, these policies mainly favor individuals with significant financial means, leaving those unable to participate in the market at a disadvantage and widening the wealth inequality between the affluent and impoverished.

Oxfam states that the White Paper prioritized promoting a complex and integrated international economy, international trade, capital flows, and global governance rather than focusing on aid for poverty reduction (109). The government may argue that instead of addressing the wealth gap, there is a decrease in poverty in certain regions but not globally. While poverty exists in America, other countries face even worse conditions and are unable to improve them.

During my time in the Philippines, I discovered that diligent farm workers earn significantly less compared to individuals with minimum wage jobs in America. This variation can be attributed to the country’s level of industrialization. Oxfam emphasizes that globalization often overlooks those who cannot capitalize on fresh prospects (110). Developed nations generate more employment options for low-income workers, while underdeveloped countries fail to benefit from the advancements made by other nations.

As wealthier nations undergo rapid development, poorer nations not only remain impoverished but also experience further economic decline due to inflation caused by wealthy governments. The inequality is exacerbated by the self-interest of company owners who favor privatization, which fails to distribute wealth equitably within the nation. This pursuit of maximum profit at minimal expense results in an uneven distribution of profits, as illustrated by Robert Reich’s description of AT&T finding cheaper labor in Singapore for the same task (124).

Production companies are seeking individuals who are willing to accept lower wages, often found in other countries where they may earn more than in demanding jobs. This leaves American workers with the decision of accepting lower-paying jobs or facing unemployment. Nonetheless, there are advantages to hiring international workers. According to Reich (126), this benefits both global workers by increasing their disposable income and worldwide consumers who can now buy high-volume, standardized products at a reduced price.

On a global level, there is a more efficient distribution of money to poorer nations, as desired by the government. However, within the nation itself, inequality arises between production company owners and the workforce. It is unjust that high-level employees receive generous earnings and benefits while laying off workers. The introduction of new production technologies has resulted in job loss and greater wealth for company owners.

In advanced countries, the implementation of new technologies results in the emergence of fresh employment prospects. Reich also mentioned that there will be a significant demand for “in-person servers catering to the old and ailing” (130). As opportunities in production labor decrease, alternative job options arise. Professions that people are unfamiliar with become sought after, and occupations such as engineering offer the possibility of wealth due to the problem-solving element. Individuals have the opportunity to make a global impact through innovative ideas akin to the creation of machinery in factories.

Despite the significance of education in specific job fields, many individuals in the past chose to enter the workforce rather than attend school. This mindset has contributed to the ongoing wealth disparity. During times of war, people prioritized immediate employment over obtaining an education. In contrast, a group known as symbolic analysts, identified by Reich, continue to thrive while other occupations decline. Symbolic analysts, including scientists, researchers, and engineers, dedicate numerous years to their education and can provide their expertise to the global economy. As the economy improves, routine production jobs lose importance and service jobs become more desirable. The demand for symbolic analysts is so great that they struggle to keep track of their earnings.

Despite the appealing income potential, many people choose not to pursue highly desirable jobs because of the educational requirements. Unfortunately, not everyone has access to this level of education. In developing nations, people are willing to take on low-wage production jobs that were once held by more advanced countries. However, as individuals in advanced nations opt for higher paying roles, it worsens the wealth inequality gap.

Education should be accessible to all individuals, regardless of their aspirations or desires in life. As developing nations progress and opportunities emerge, the gap between the wealthy and less fortunate may gradually diminish. One potential resolution is to provide comprehensive education to all individuals, enabling them to attain success and happiness in life. Whether one aspires to become a doctor or pursue a career as a symbolic analyst, there should be no limitations hindering their achievements. Furthermore, if a nation excels in areas such as poverty reduction or maintaining a just governance, other nations should take inspiration from their accomplishments.

People should collaborate and avoid selfishness, as no one should have to endure hardships in their singular life. The existence of both affluent and impoverished individuals is inevitable. The key lies in how the government acts to elevate the living conditions of those less fortunate. – Bradly 5

Works Cited

Oxfam. “Globalisation.” Writing about the World. Eds. S. Mcleod, J. Jarvis, S. Spear. Boston. Thomson Wadsworth, 2004. 108-114.

Reich, Robert. “Why the Rich Are Getting Richer and the Poor, Poorer” Writing about the World. Eds. S. Mcleod, J. Jarvis, S. Spear. Boston. Thomson Wadsworth, 2004. 123-134.

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