Articles

Threat to Democracy: Economic Disparity in America

By James T. Laney and Andrew Young
Faith And The City E-Letter, Volume 2 Issue 1
January 15, 2003

Poverty. Most of us have a pretty good idea of what it means -- enough to know we don't want to be poor.

Yet, we seem to have a persistently high tolerance for the poverty of others. Of approximately 280 million people in the United States, 35 million are officially listed as poor. The count is based on federal guidelines, which set the poverty level for a family of four at $18,100 per year. Many advocates argue that such guidelines greatly underestimate the cost of living and, consequently, grossly undercount the number of people actually living in poverty. Worldwide, more than 1 billion of the world's 6 billion people subsist on less than one dollar a day -- less than the cost of a cup of coffee in many U.S. cities.

Why should you and I care? Some folks say we shouldn't be concerned that millions of men, women, and children struggle through daily life without basics like clean water, adequate food and shelter, and decent medical services. But many of us are concerned.

Our concerns most often are moral, political, or economic in nature. Moral concerns frequently are rooted in religion, with most of the world's major faith traditions calling their adherents to aid neighbors in need and nurture community. Political concerns often point out that effective democracy requires an informed and involved populace -- the fertile soil in which equal opportunity, competition, and fair play can thrive. In short, poverty forces large numbers of citizens outside the economic mainstream, with severely limited opportunities to improve their lives. This condition undercuts the promise of democracy or, as in some parts of the world, hampers efforts to establish democracy.

The merits of moral and political objections to poverty notwithstanding, economic arguments often garner the most attention -- focusing on poor people as a historically underserved, but potentially productive, market segment. In effect, the poor are an economic minority, ignored like racial and ethnic minorities throughout most of our nation's history.

Although much work remains to level the playing field in race and ethnic relations, recent progress is dramatic. For example, the Hispanic American and African American markets today each approach or exceed $500 billion annually. Each group numbers approximately 35 million people, about the same as poor people.

Take a moment to think about these figures. Consider the positive economic impact of today's Hispanic American and African American markets. In Georgia alone, African Americans spend 19 cents of every dollar spent. Imagine the positive impact that our 35 million poor people could have if we recognize that -- economically empowered -- they can contribute potentially hundreds of billions of dollars to the nation's prosperity. Consider the impact that a billon poor people today -- developed into a productive market segment -- could have on the international economy.

So why are we not more concerned? Perhaps this question takes us back to the moral and religious emphasis on our responsibilities to our neighbors, our communities, and the common good. Maybe we just don't care about our neighbors, our communities, or the society that we will leave to our children.

Maybe that is why the gap is growing between the wealthiest class of Americans, on the one hand, and the middle class and poor, on the other. The wealthiest 13,000 families now enjoy nearly as much income as the 20 million poorest families -- and 300 times the income of average families, according to Paul Krugman's article, "For Richer: How the Permissive Capitalism of the Boom Destroyed American Equality" (The New York Times Magazine, October 20, 2002). Another index is the extraordinary disparity between pay for average workers and pay for top CEOs. Over roughly the past 30 years, Krugman notes, the average annual salary, expressed in 1998 dollars (adjusted for inflation), rose from approximately $32,500 to $35,900 -- about 10 percent. By comparison, pay for the top 100 CEOs soared from $1.3 million, which is 39 times that of the average worker, to $37.5 million -- more than 1,000 times what the average worker now makes.

What's the bottom line? "It's all too easy to see how we may become a country," Krugman writes, "in which the big rewards are reserved for people with the right connections; in which ordinary people see little hope of advancement; in which political involvement seems pointless, because in the end the interests of the elite always get served."

Kevin Phillips, in Wealth and Democracy, states the danger with equal candor: "Either democracy must be renewed, with politics brought back to life, or wealth is likely to cement a new and less democratic regime -- plutocracy by any other name."

Democracy -- not plutocracy -- was the ideal on which this nation was founded more than two centuries ago -- and a vital and thriving democracy is the heritage that we Americans want to leave to our children and continue to model for the world community.

At Faith And The City, we believe that most Americans are firmly committed to a future that ensures liberty, justice, and opportunity for all people -- a nation and a world much like the one described by Martin Luther King Jr. "I have the audacity to believe," he wrote, "that peoples everywhere can have three meals a day for their bodies, education and culture for their minds, and dignity, equality, and freedom for their spirits."

Ambassadors Young and Laney are the founding co-chairs of Faith And The City.


Reprinted with permission from The Atlanta Journal and The Atlanta Constitution. Further reproduction, retransmission or distribution of these materials without the prior written consent of The Atlanta Journal and The Atlanta Constitution, and any copyright holder identified in the material's copyright notice, is prohibited.