User:Shanakiraj/Economic inequality

Economic inequality is when resources and wealth are not well distributed among the people of a nation, leading to inequal opportunity.

Globalization
Although the disparity between the rich and the poor have been rising over the past few decades within countries, the actual amount of economic inequality in the world has been decreasing due to globalization. Because of world trade and the constant increase in global GDP, the amount of people suffering from extreme poverty have decreased dramatically over the past few decades.

Policy Responses Intended to Mitigate
Expand the Child Tax Credit

The Child tax credit is a federal tax credit on every child that is under 17 years old. This would lead to economic relief for families in need. This is a progressive tax credit that benefits lower income families which would help to mitigate the negative effects of our current system, and effectively help to equalize the wealth within nations.

Estate Tax

An Estate Tax is a tax on inheritable wealth. A major issue with our current state of economic inequality is that all of the wealth pools around the top 2%, and continues to accumulate. Part of the reason for this is the lack of taxation upon inheritable wealth. If there was a heavier tax on inheritable wealth, we would see less concentration of wealth and better distribution among people, along with more government revenue to fund social programs to help reduce the economic burden that some people unfortunately face.

R&D Tax

An R&D tax credit is a federal policy that allows for institutions to receive tax credits for spending and investing in domestic research and development. This policy would help reduce economic inequality because it would directly increase the amount of investment within the economy. This would spur the growth of new jobs as well as improve living standards in the long run.

Education Reform

Education reform is necesarry to allow young children to be given the opportunity to succeed in their future endeavors. More government funding towards education would help financially benefit lower income households. Additionally, making higher level education cheaper and more accessible would allow for a higher percentage of skilled workers and would increase average incomes.

UBI

UBI stands for universal basic income, and would grant everyone in a nation a fixed cash amount each month. The purpose of this would be to help lift people out of poverty, stimulate the economy and spending, and allow for people to break the cycle of poverty and even gain the chance to invest and grow their wealth.