Social Economic Inequality Term Paper

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Social Economic Inequality

When people think of social inequity, they generally frame this in terms of socio-economic class. People who have accumulated much wealth occupy the top echelons of society and enjoy the most privileges as brought on by their money and social status. On the other end, people who are poor have little or no access to these privileges and are often marginalized in terms of education and social services.

However, there are many forms of social inequity and stratification. In the United States, for example, much of social interaction is mitigated by gender and race. For example, statistics show that a wage gap exists between the genders. Despite pay equity laws and a growing awareness of gender discrimination and women's rights, salary disparities continue to exist between men and women across a broad range of occupations.

This paper argues that socio-economic inequality is caused by many non-economic factors, such as stratification and racism. After all, factors such as these prevent many members of marginalized social groups from fully-benefiting from social institutions such as education and the workforce. This lack of access could thus lead to poverty and by extension, unhappiness.

However, this paper also argues that despite its failings, the capitalist system has the most options for human happiness. This approach should be tempered by the recognition that no true capitalist state exists. Capitalist states such as the United States and the states in Western Europe recognize this and provide state-sponsored social services to the needy. While this liberal democratic system remains problematic, it is essential to ensure that everyone has equal access to the institutions that pave the way for the pursuit of happiness.

What are the best social systems to reduce inequality?

To its proponents, capitalism is the only economic system that could guarantee human happiness. This is because capitalism was the economic system wherein individuals or "free agents" pursue their own interests. People who work and earn money in exchange for their labor benefit themselves and are able to fulfill their own needs. By trying to earn money for themselves, working people unwittingly contribute to the greater good of society, as if they were "as if guided by an invisible hand." (Smith, paragraph IV.2.4 -- IV.2.6, IV.2.9).

Smith viewed capitalism optimistically, as a system of natural laws that allow free agents to pursue their own interests. This gives rise to a system of cooperation, where free agents produce goods and contribute to the well-being of society as a whole and to individual happiness in particular.

Karl Marx's view of capitalism was not quite as rosy as Smith's. An analysis of capitalism and its effects was a central theme of all his writings, but it was in the three-volume opus Capital that he presented a systematic study of the inherent conflicts in capitalism and its great human costs.

Laurence Harris, an economist with the University of London, writes that Marx viewed the development of capitalism as "a conflict between labor and capital." A capitalist economic system requires an economic gap between capitalists and the working class (Bottomore, p 66). For Marx, the private ownership of capital at the exclusion of others is a central feature of capitalism. The system is controlled by a few affluent citizens, at the expense of an underclass of workers, whose wages are kept low by the constant threat of replacement.

What is the best means of achieving social equality?

Achieving social equality is not an overnight process. Rather, the task of achieving equality means tackling the roots of this inequality -- such as lack of access to quality education and the racism in society's various institutions. These two factors give rise to poverty, alienation as well as unhappiness. This task often requires intervention from government authority, a fact which may not sit well with many opponents of socialism or communism.

However, even capitalist countries such as the United States practice some form of socialism. The welfare system, for example, is widely-viewed as a safety need for families in need. Related to this, Social Security provides a nest egg for people to draw from once they retire. Since its inception, the coverage and benefits of Social Security have been expanded. While the original Social Security Act was limited to only retirement benefits for the worker, two 1939 amendments added benefit payments to the retirees' dependents (spouse and to the minor children) and survivor benefits to the family in case a covered worker dies prematurely. Thus ushered in the Social Security program that is in place today, one that provides security and benefits for the family rather than just an individual worker (Schieber and Shoven, 31).

Unfortunately, many critics are arguing for the abolition of all state-sponsored social services, and are advocating privatization instead. Still others remain blind to this problem. For example, while the number of uninsured people continues to rise, there are pundits who continue to maintain that the United States "is the envy of the world when it comes to healthcare" (cited in Kangas, 27). Former U.S. Secretary of Health Joseph A. Califano echoes this sentiment, saying the American healthcare system is "the finest system for treating illnesses and injury in the world" (18). As long as people do not acknowledge this growing social problem, factors that contribute to social inequality and unhappiness will continue to fester.

What countries best have achieved the best results in terms of social equality?

Every year, the United Nation Development Programme (UNDP) comes out with a Human Development Report. This report rates countries according to their levels of human development. In addition to economic indicators like GNP, this report also looks at factors like life expectancy, access to healthcare, political freedom and education/literacy. These factors make the report a more accurate measure of the levels of happiness among the populace.

According to the latest 2004 Human Development Report, the United States ranks eighth, finishing behind Norway, Sweden, Australia, Canada, the Netherlands and Belgium (Human Development Report, 4). It is interesting to note, however, that all countries listed in the top 10 are welfare states. All of the countries that rank ahead of the United States have more encompassing welfare systems. This data provides support for the argument that having a social safety net is a foundation for human happiness.

Norway, for example, has a life expectancy of 78.9 years old. This implies that its citizens are healthy, have no problems receiving basic needs like nutrition and clean water and have adequate access to healthcare. A full 99% of its population is literate, and 98% have access to education, from primary school to college. Unlike some of its industrialized counterparts, Norway has also shown a strong commitment to women's rights, ensuring that women have the same access to education and public life (Human Development Report, p. 16, 64). These factors form the foundation for a high level of human development and human happiness.

Is the economic system of the United States counter regulatory to achieving social equality?

As stated earlier, the United States has several structures in place for paving the way towards human happiness. The Social Security and other welfare-related programs, for example, provide a safety net for the underprivileged or those who need temporary assistance. The foundations are in place, but much more needs to be done, and the United States could take some cues from examples set by countries like Norway.

All countries that ranked ahead of the United States, for example, have one important social service in common -- universal health insurance for all its citizens. Much of the opposition to this vital service lies in fears of tax hikes. However, In Canada, the institution of a single-payer system has not resulted in inefficiency or even rising costs for the taxpayer. In the Canadian system, healthcare continues to be provided by private as well as public healthcare providers. The difference, however, is that the government is the one charged with paying for these services.

As a result, while the number of uninsured Americans continues to rise exponentially, every Canadian had access to medical and health care. It should also be noted that the Canadian definition of health care is also more inclusive. While the system in the United States is severely limited to people who are already ill and the elderly, Canada also addresses preventive care, for the entire population. If access to healthcare is recognized as a foundation of human happiness, then the United States needs to work more in this regard.

As it currently stands, the United States has more tasks ahead in ensuring equality and happiness for all its members. However, the liberal democratic foundations already exist. All that remains is for these foundations to be strengthened, to ensure that they work towards ensuring happiness for all Americans.


Currently, the United States mostly employs liberal policies to address social inequity. For the most part, most professions in the country are now open to women. African-Americans and other racial minorities are no longer overtly barred from seeking admission…

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