THE DIFFUSION OF OUR NATIONAL PROSPERITY
ECONOMIC INEQUALITY AND THE IDEAL OF EQUALITY OF OPPORTUNITY
1. Economic Inequality. -- National prosperity is not synonymous with individual prosperity. Because the national income is adequate in amount to permit a decent standard of living to be enjoyed by all individuals and families in the United States, it does not follow that such is actually the case. The following survey of the distribution of our national income will show that great differences in individual incomes have existed and still persist. Hence, poverty has not been eliminated and subnormal standards of living have not been eradicated, even from prosperous America. Great riches and glaring wants have continued side by side, in spite of the fact that our national income and our per capita real income have been rapidly increasing.
A striking picture of the existing economic inequality was drawn in 1928 by Professor Warne. He spoke as follows.
The producing group hasn't sufficient income to absorb production, hence the factories of the United States are producing only two-thirds to a half of what they are capable and there is a difficult unemployment problem.
There has been a one-third increase in the total income of the inhabitants of the United States since 1919, but real hourly earnings have increased only 11 per cent, on the average.
Thirty per cent of the total income of the inhabitants of the United States goes to 6.4 per cent of the population. Of the wealth inherited in a year in the United States, 82 per cent goes to 5.3 per cent of the population -- 58.9 per cent to 11 per cent of the population.
We have been over saving and under consuming.1
In the following chapter theories of wages will be reviewed and the course of real wages will be traced. It will be found that real wages in the long run for most groups have increased. By and large, the workers have shared in our increased prosperity, but whether they have shared proportionately in our increased productivity is a very different question.
It is also true that money wages and even real wages are higher in the United States than in most countries of the world. On the other hand, social insurance is very common in Europe, where the worker generally enjoys greater economic security, if not so high a standard of____________________