Inequality

Inequality is one of my favorite subjects in school. This sounds kind of messed up, but it’s true.

My interest since high school has always been the socioeconomic inequality that is prevalent in the United States. Particularly, how 1% of the population holds approximately 30% of the entire nation’s wealth. This trend in the US has been documented over time by Thomas Piketty and Emmanuel Saez. When the Occupy Movement occurred right outside the windows of my high school, the fact became more real to me.

[These graphs below are some statistics on income inequality in the US.  I like this stuff, so read the captions if would like to know more.]

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The Gini Coefficient is a measure of inequality in a country. A Gini Coefficient of 0 means absolute equality – no one makes more than the other – and 1 means one person holds all the wealth in the entire nation (you can have this on a 0-100 scale). A country will lie within the spectrum. The US currently has the coefficient of .38 as of 2013 (and as of 2008, Vietnam was a coefficient of .35). But, as you can see in the graph, the coefficient started to increase started in the 1960s. There are many reasons for this, but I want to point out that the 60s was a big decade for US-Vietnam relations.
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This graph shows the income share of the top 0.1% of the US population over time, taking into account labor income and capital income. This is the top 0.1% not the 1%. You can see here that in 2012, the top 0.1% hold approximately 11% of the income. And there’s a suspension bridge trend, with peeks in 1929 and 2007. What are those years? The first year of the Great Depression and the Great Recession, respectively. This graph shows that when much of the income is held by the smallest amount of people, the economy goes out of whack. And the decades where they held the smallest share was when FDR’s New Deal was in place (and marginal tax rates were over 80% in the highest bracket).

I grew up in a low-income background and my neighbors were mainly Latino people. I say this line a lot, but it doesn’t make it any less true: everyday when I took public transportation to school, I would see the shift from dilapidated and graffitied buildings to high rises and corporate offices in the Financial District of the heart of the city: Downtown LA. (Now the neighborhood in which I grew up is quickly becoming gentrified… But that’s not the point.) And even in the DTLA, the inequalities between rich and poor were stark. If you drove down the street for a little while, it wouldn’t be hard to miss.

But this is just a little background on one of the respond why I became interested in economic inequality.

At my time at Cal, I have come to know more about inequality in different aspects, not just economic: power, gender, race, class, etc.  Inequality, broadly affects everyone in certain aspects.

And I’m not saying inequality is bad.  From an economic standpoint, as I am an economics major, income inequality incentivizes people to work.  If you know that you could potentially make more money in the future, then you might work harder / get more education / learn more skills.  If, on the other hand, the society was utilitarian, it might not give you any incentive to work because you get the same amount of income no matter how much (or how little you work).  I understand that intuitively, but I also want to know that your income is the not the only fact that makes people work (though it is a big factor).

And I’m not saying that inequality is not inevitable.  If you leave society as it is, inequality is going to happen.  But, in my opinion, too much inequality is bad.  There are many reasons for this, but I won’t get into it.

So, how does this relate to Vietnam?

Well, it doesn’t.

Just kidding, it totally does.

Vietnam is considered a communist-socialist society.  With just that alone, theoretically, people should be equal to one another.  There is no private property.  However, officially, after Doi Moi (Renovation Policy) was passed in the 1980s, it became a “socialist-market society”.  That alone, confuses me.  I have done some research on Doi Moi, and it is essentially a policy that introduced capitalism to Vietnam.  I wrote some about this in a previous post.

So, in Vietnam, there are sources where Vietnam should be equal, but knowing capitalism and reality, it is true that Vietnam is unequal.  Depending on who you ask, it’s very unequal.

For my parents and my family, going back to Vietnam is a touchy subject. As I wrote in a previous post, my parents had so many concerns.  They came to the US for a reason, and they will always hold it over me that despite growing up with a low-income background in the US, it’s always better than what would have been in Vietnam.

Recently, because my focus has been on Vietnam (I did research on it for 105, I traveled there, I took the History of Vietnam class, I am learning Vietnamese in a formal classroom), I have been seriously thinking about focusing on Vietnam and Southeast Asia for real.  Meaning, that would be my economic concentration.

Yet, I really hesitate with this decision because of many reasons but two come to mind.  First, specializing in Southeast Asia would probably mean traveling to Southeast Asia (from now on, abbreviated SEA) often.  I wouldn’t be taken seriously if I never went back there, and there is really a limit to what I could really learn about SEA in the US.  But, I have to consider how my parents and my family feel about it.  I know that never did they ever think I would ever take my life in that direction, and that all comes with uncertainty.

And second, for a very long time, and as you can maybe tell through the beginning of this post, my interest has always been about inequality in the US. How could I just change that?  I was hoping to work with Prof. Saez for the rest of my life (kind of) and come up with policy that would address inequality.  Or, I was hoping to make a movie about inequality in America and highlight many stories of how economic inequality affects the lives everyone.  I don’t know–these plans are still in the works.  But, the point I’m trying to make here is that for a very long time, my life was focused on socioeconomic inequality in America.

But, like I’ve been trying to say (though probably failing) is that there is inequality everywhere, especially in Vietnam.  Though, the inequality in Vietnam is a quite different nature, I believe that I am invested in economic inequality as a overarching concept in general.  It could be possible that I could make the switch.  I don’t know.  Still thinking through a lot of.

And now, I’m getting to the end….

Even though I started this post looooong ago, I am finishing it on Cal Day.  And today, at the GPP table, we had activity for people to do if they wanted to win a cool GPP T-shirt.  They had to respond to one of two prompts:

I care about inequality because…

or

I engage in poverty action because…

It’s very obvious that I care about inequality because I believe that people should have equal opportunities to succeed.  I have described that background from which I grew up, and that background has led me to care about inequality.  But…. I really couldn’t write down why I care so much about inequality in such a tiny little blackboard.  Anyway, here is my response:
image

Happy Cal Day!

(This is a happy day, yet I talk about inequality… sorry!)

Over and out.

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