We hear ad nauseum from the mainstream media, and particularly the business-focused press, that the
While not the only type of oppression institutionalized into the current social order, income inequality has a major impact on people’s lives: especially at the lower levels, lack of income affects all kinds of life chances and even existence, such as health, likelihood of being a victim of violence, and access to medical services. (And we know that the consequences are even worse when racial and/or gender oppression is added.)
Yet, unknown to most people, the
In addition to considering the overall situation as illustrated by Gini scores, they also can help guide public policy decisions. For example, if income inequality is increasing, then any type of progressive policy implemented would seek to reverse that growing inequality. Or even if you are talking about cutting taxes (say in the current
The Gini index is a numeric scale that runs from zero to one. A score of 1.000—it is usually represented by scores in thousandths—thus represents perfect inequality. A score of 0.000, therefore, represents perfect equality. So, the higher the score, the greater the inequality.
The Gini index can be used to measure economic inequality in a number of ways. It can measure inequality across individuals, families, and households (unrelated people sharing housing), and it can measure inequality across racial groups, by gender, by education level, etc. In short, it is a very useful tool that is well established and relatively simple to understand.
However, the Gini measure is not perfect. While it can be used to address economic inequality by whole or by selected group, getting Gini index scores by the different groups (for comparative purposes) is difficult, and it’s not even known if this measure has been computed internationally on any consistent basis. Data available does not take into account the size or productive capacity of a country, areas within countries, or any other factors: what is available is a composite score for entire countries, in this case regarding family income inequality. So, it should be taken conservatively: this data is merely suggestive, not definitive. Nonetheless, the suggestiveness of such data deserves consideration.
In this article, I focus on income inequality across families. I have chosen to focus on this because I have data to compare the level of family income inequality around the world. Thus, while not repeating myself, all comparisons herein are of income inequality among families.
In the
In the first period, the measure of inequality showed a small but persistent decline. From a score of .376 in 1947, it moved unevenly but dropped to .348 in 1968.
Since 1969, the trend has reversed, moving consistently in an upward direction—representing increasing income inequality. In 1969, it was .349. In 1982 (under Reagan), it hit .380 and has never gone below that amount since then. Since .379 (in 1950) was the high point of income inequality in the 1947-68 period, this means that every year since 1982, income inequality in the US has always been greater than the worse level of inequality that existed in the earlier period.
Income inequality has increased under both Republicans and Democrats. Under Reagan, it went from .369 in 1981 (the first year in office) to .395 in 1988, his last full year. Under Bush I, it went from .401 in 1989 to .404 in 1992. Under
(The higher the Gini score, the greater the inequality) While this trend is troubling in and of its own self, I thought it might be interesting to see how the rate of family income inequality compared to that in other countries. A look at the CIA Fact Book at www.odci.gov/cia/publications/factbook/fields/2172.html provided the information I was seeking. (Despite using CIA data and World Bank categories, below, this does not mean I accept their work—however, it is useful for comparative purposes.) The World Bank categorizes countries in different ways, such as by regions of the world; however, for our purposes, the measure most useful is Gross National Income per capita. (GNI used to be referred to as Gross National Product, but they changed the name.) In other words, the goods and services produced in a country in a year divided by its population. The World Bank places countries into one of four categories for this measure, and here I used its latest figures (from 2003). Countries where the GNI/capita is $765 or less a year are labeled as “low income.†Those between $766-3,035 are “lower middle incomeâ€; between $3,036-9,385 are “upper middleâ€; and those over $9,386 are “high income.†And the Bank categorizes most of the countries of the world—I’m not certain they include every country—into one of these four categories www.worldbank.org/data/countryclass/classgroups.htm. The CIA does not categorize the countries in the Fact Book according to the World Bank categories, but they do provide the Gini index for 110 different countries, which includes most of the countries so categorized by the World Bank. (The CIA reports the Gini index by whole numbers and tenths, which I’ve never seen used elsewhere, but it is easily convertible to the standard reading, which I have done.) What this enables me to do is to group the countries according to World Bank categories, and compare rates of family income inequality by income level of countries across the globe. (The CIA does not include all countries—for example, neither
Income Category |
Average Gini Score Median Gini Score |
Gini Score, US (2001) |
Low-income countries |
.431 .406 |
.435 |
Lower-middle income countries |
.429 .414 |
.435 |
Upper-middle income countries |
.385 .370 |
.435 |
High-income countries |
.313 .316 |
.435 |
Then, I decided to combine all of the 110 countries that I had obtained Gini scores on, rank them in order (from lowest income inequality scores to highest) to see where the
Region |
Average Gini Score Median Gini Score |
Gini Score, US (2001) |
Sub-Saharan |
.446 .410 |
.435 |
East Asia & Pacific |
.424 .404 |
.435 |
|
.367 .367 |
.435 |
Latin America & Caribbean |
.518 .526 |
.435 |
Europe & |
.336 .343 |
.435 |
As one can quickly see, the level of family income inequality in the
_____ Kim Scipes is a long-time activist in labor and other progressive movements. He currently teaches sociology at Purdue University North Central in