Social Globalization: Inequality - Research Paper Example

Social Globalization Inequality is a term used to define imbalances in economic and social development. This imbalance has been practiced in various countries in the world and it has been due to due to the political influence of a few elite or rich classes. The rich in the society having the control of the political class and the governance of the state make sure that they do create policies which favour them. Therefore, there develops an unequal way of distributing national resources. The rich in the society takes a larger share of economic resources than the majority poor. Over the last thirty years, there have been witnessed a great inequality between the rich and the poor (Dadush, Dervis and Milsom 1). The rich have continued to amass so much wealth and grow richer while the poor have continued to live in poverty and their economic power has reduced such that they cannot afford to provide for their most basic commodities. To understand the disparities between the rich and the poor, it is important for us to look at the class theory (Dadush, Dervis and Milsom 3). In every society, the standards of living can be divided into a structure of classes. There are mainly three levels of classes in society. There is an upper class level which is mainly occupied by the wealthy in the society. They are the key owners of the means of production (Colclough and Manor 2). They control a huge percentage of the wealth of the nation and have much influence on the policy making of the nation. They are usually few in the society than the rest of the classes. The second class is the middle class. This group mainly consist of the population which are employment and have a good income but not enough for investment. They are usually the managers of the investments made by the upper class. Their main work is to ensure that the upper class continues to grow rich by ensuring that their investments are profitable. Their number is a bit larger than that of the upper class. The last group of class in the society is the lower class members. This class usually forms the majority in the society. They usually labour to get the most basic necessity of life such as food, shelter and clothing (Karagiannis, Madjd-Sadjad and Swapan 16). Concerning the class in the United States of America, there seem to be a growing gap between the rich and the poor. The number of the rich is growing smaller while the poor have been increasing at a very high rate. The middle class has been diminishing day by day due to the low income they are earning and the high cost of living they are experiencing. The middle class, therefore, cannot afford to have some money to invest or acquire better accommodations for them and their families. The global economic meltdown of the year 2007 clearly reflected how the middle class operations were unable to cope with their daily life and catering for their families. It meant that the middle class had already died a long time ago. There has been a great inequality in terms of the income of the people of the federal government of the United States of America. The major cause of this inequality has been the government itself because it has allowed immigrants to take over the state jobs at a cheaper cost at the expense of the native people. They, therefore, employ immigrants instead of its citizens. Technology innovations and its changing nature have also contributed to unemployment. Most of the companies have opted to reduce the cost of production and increase profit by adopting new technology (Colclough and Manor 185). They, therefore, retrench many of its workers. The fact is that a machine like a robot can replace so many people and it only need a few people to operate it. Therefore, many people who had been working on that capacity end up losing their jobs. The owners of means of production ends up growing richer due to the decreased cost of production while the middle class who have been working on those capacity drops to the status of the lower class. The shifting of the means of production from the human labour intensive to the machinery labour intensive has in the long run been able to widen the gap between the rich and the poor. Indeed, the overall income for the owners of the capital in the production process has been multiplying day after day. The other side of the chain has been experiencing difficulties in acquiring its basic needs. This is because the place they have been earning their daily meal has been taken over by the machines and technology in large. As long as this situation continuous, the smaller group of the rich will continue to be rich while many people will be replaced by the technology and join, the lower class living in poverty and anguish in their struggle to search for a living. Neoliberalism has also contributed to the disappearing of the middle class in the American society. The government of the United States of America has allowed its key investors to use any means in wealth creation through exports. This can be termed as a liberal way of carrying out trade. , therefore, have come up with a cost of production lowering mechanism to ensure that the goods and services they produce can effectively compete with other goods and services produced from other countries. They, therefore, do not get how the ideas they implement affect the middle class in their own countries. The most efficient way to achieve their goal and sustain them in the stiff market competition is by reducing the number of workers and replacing them with efficient and effective technology. This technology then replaces the human labour. Their products even though sold at a low price; they make a lot of profits. The negative effect of inequality can be reduced if the government can come up with relevant policies that can make sure the growth of the upper class do not surpass that of the middle class. This can be done by considering that the middle class plays a very important role in the development of the state. They should make sure that the rich do not invest on programs which do not require much human labour. Such programs can be ensured by giving local investors incentives to make sure that even if they do not use the cheap technology, they will continue to enjoy a huge global market. The government can introduce incentives to keep the labour force in their jobs offering skills in the production process. The incentives may include such things as of tax relieves to firms involved in the productions of goods and services. Tax increases the costs of production to the firms, and their waiver make the production process effective. The government can also offer to sign treaties that allow similar commodities produced from abroad to enter into the country. This can help firms to compete favourably with cheap commodities from abroad. This will ensure local firm of the ready market and will keep all its employees in their industries. The increasing status quo in terms of income can also be discussed in terms of the Marxist theories. Karl Marx argues that the production process consist of two major partners who are the firm owners and the workers (Dino). He argues that the firm owners have all what it takes in terms of machineries and the capital. The workers on the other hand have the skill required in order to complete the production process. The two always need each another for their end benefits. He argues that because their input is almost equal, they must share the profit equally. Marx theories of equal sharing of the resources have been greatly criticized by the capitalist societies who argue that the labourers need the capitalists more than they need them (Dino). This can also been looked from another angle. The owners of the means of production are fewer compared to those who are ready to offer their skills in the labour market. The skilled labours now compete to have a chance to take place in the production of commodities. They are, therefore, discriminated by the firm owners in terms of enjoying the benefits of the final product. Marx looks at the issue of the labour force offered by the workers as a commodity. The workers do sell their skills to the owners of the means of production at a cost which is paid in terms of salaries. The workers do not enjoy the full benefit of the commodity since they get a small percentage of the total income. Some workers’ salary is so much low that they cannot afford to buy the goods and services they produced. They end up working as slaves to the rich. They do give out the labour which is not compensated well enough it terms of wages and salaries. What they get is just a small percentage of the total income that they create. The rest is usually enjoyed by the rich who owns the means of production in terms of profit. Education has also been seen as a means of developing capitalism and widening the gap between the rich and the poor. It is only the rich who can afford quality education. The poor lower class people do not have access to quality education but only the basic education. This is because of the high cost of acquiring good education. Since the poor cannot be able to acquire skills which are important in the running of the industry, they become alienated when it comes to the division of labour. The rich usually use a person’s level of education to determine what kind of service they can offer to the firm and what amount of salary they can get. The higher the level of education one has a better position they do occupy in the industries and also the higher the amount of income they do get as a return. Since the poor cannot afford better education, they end up occupying the less attractive positions in the industries and earn very little income. There is growing numbers of skilled labour, but the market of their skill is decreasing day by day. The supply of the skills has exceeded the demand in the labour market. From the theory of demand and supply, when the supply is higher than the demand, it means that the price will go down for the same amount of work or even higher. This means that the workers will become more and more exploited, and they cannot react because they fear losing what they have already. The market does not favour workers. If, for instance, the supply of labour is fewer than the need for it, then the price for labour may go high. This is unlikely to happen because industries increase at a lower rate than the skilled population. The theory of labour supply and demand has greatly caused the imbalance in the status quo. The job supplies have greatly gone down compared to labour supply. Therefore, the skilled labourer lacks the market to offer their service at a better wage. When they do get a place, they are paid less which is not worth their services. They, therefore, continue to live in poverty and cannot even be able to afford their basic necessities. On the other hand, the rich who owns the industries do enjoy a lot because they are able to buy labour cheaply and use it in production. They then sell these commodities to those who manufactured it at a higher cost so that they get a huge amount of profit in the end. Therefore, the 1% of the entire population continues to gather so much wealth and becomes richer than the 99% who ends up in poverty. De-territorialisation has, however, emerged due to the emergency of the two strong classes in the society. This means that territories have emerged dividing the two classes of the rich and the poor (Friendman 128). This is very visible in terms of where they live and its environment, what they eat, where they take their children to school and so many aspects which demarcate the rich and the poor. The rich usually live in places with a clean environment which are far away from industries which pollutes the air. They also take their children to the best colleges so that they can get the best form of education which will help them in future to take over from them in the running of their wealth. The fact is that they were originally intended to have the same goals since they all contribute to the final commodity of the firm. But because the skills as a commodity were bought at a very low price, it meant that its value cannot be used to buy such expensive facilities as the ones used by the rich. The classes become more separated even physically in terms of what one can afford. This class separation have been witnessed in the present United States of America population as the growing lower class cannot afford better living standards like their upper class fellows. Fordism is another tool that has been used by the rich as a way of multiplying their wealth at the expense of the majority poor (Thompson). Generally, Fordism entails the manufacture of commodities by the use of machines such as robots (Nolan 40). Since a machine needs just a little cost of operation, it follows that the commodities produced are cheap and affordable. Most of the companies usually target the majority lower class as their main source of market. Since they are low income earners, the manufacturers come up with cheap goods which can fit them. Fordism was also a way of eliminating the so much needed human labour force (Thompson). It could take so many men to move a certain object from one point to the other, and this could translate to high wage bill leading to a higher cost of living. When the machine is introduced, the labour force is reduced to a few men who now need to operate the machine which does not need to be paid. This reduced cost in production could then be translated to cheaper prices at the market place, but which can now fetch a higher profit to the industry owners (Thompson). Fordism has also led to the growth of the service delivering industries by removing so many barriers (Nolan 36). For example, the use of computers and internet has eased communication. In the past, people used to travel for very long distances just to deliver a mail. Nowadays, mail delivering is as easy as the click of a button in a computer. The disadvantage of these services is that it has rendered the mail delivering companies which were particularly owned by the middle class to halt their operations. This is because mail delivering was not a one man event but a group event. Therefore, the lower class will continue to expand so long as Fordism exists (Nolan 38). The state will have to intervene in this situation and try to make sure that the status quo has reduced. It should try to reduce the poverty levels by creating and implementing various policies as in the Keynesian theory. These policies may include the monetary and the fiscal policies. Monetary policies involve the reduction of the lending rates. If the lending rates could be reduced, more people will be able to borrow funds from the commercial banks and open up businesses and industries which would create employment for other people, as well. This is because it would be easier for them to pay back the amount borrowed as loans since it would be cheaper. Implementation of this policy, the state, needs to increase the amount of money which can be given out as a loan. Increasing the loanable amount will automatically reduce the lending rate since more people will be going for it. In the long-run, more jobs will be created, and more people will be able to meet their daily needs (Nolan 62). Fiscal policy can be done through a proper provision of infrastructures such as good roads, communication lines, security, water and electricity (Nolan 67)These infrastructures will enable local and international investors to put more firms and industries. It will follow that more local and unemployed citizens will find a place to sell their skills in a competitive price. They will be able to increase their purchasing power which will in the long run enable them to invest in various sectors. Over the years, as this cycle moves on, the gap between the rich and the poor will shorten. It will therefore lead to an equal society though some cases of disparities cannot be written off. At least, the 1% rich and 99% poor society will be a thing of the past. This policy and their implementation can never be realized immediately, but it is a long term policy process. Therefore, every organ of the government needs to work together for the welfare of the common man. It is something which is achievable. Another way in which the growing number of the lower class can be reduced is by moving from the capitalist society to the moderate socialist society. This was in agreement with the socialist John Adams (Adams). He argues that the American dream was to establish an equal society through job creation and capacity building. He also points out some religious values that could have enabled the citizens to live together without there being some who could have alienated themselves from the rest (Adams). The owners of the means of production were to provide capital and employ the work force at a higher competitive wages. By doing so, the people purchasing power would be high and the production cycle would benefit them all. Though there has been the status quo before, it has not been this huge as witnessed today. This is because this theory was later overtaken by greed and pride. The society moved from a socialist to a capitalist one. Capitalism encouraged the wealthy to mistreat the poor, and they were even seen as a lesser people in the society. They were alienated and separated in so many ways. First, the rich sought their own living places. They build better houses in clean and conducive environment while the poor lower class moved to houses in polluted areas. This is because those were the places they could afford. The rich were able to have the best doctors who could look after their health, and this ensured them good health compared to the poor lower class whose health conditions deteriorate more often. In conclusion, the society needs to work together for the common good of every citizen. The rich and the owners of the means of production must know that the lower class is a very important organ in their production process. They should indeed work to ensure that the middle class starts growing up again. This is because the growth of the middle class ensures that the majority of the population gains some economic power and are, therefore, able to purchase the goods and services produced by the firms owned by the rich upper class. In the long run, restoring the middle class is a benefit to every person in the nation. Works Cited Adams, John. "Thought on Government." April 1776. Heritage Foundation. 12 April 2014 . Colclough, Chritopher and James Manor. States or Markets?: Neo-liberalism and the Development Policy Debate. Oxford: Oxford University Press, 1993. Dadush, Uri, et al. Inequality In America. Virginia: R.R. Donnelley, 2006. Dino, Felluga. Terms Used by Marxism. 17 July 2002. 12 April 2014 . Friendman, Benjamin. Inequality in America: What Role for Human Capital Policies? New York: Mit. Press, 2005. Karagiannis, Nikolaos, Zagros Madjd-Sadjad and Sen Swapan. The US Economy and Neoliberalism: Alternative Strategies and Policies. New York: Routledge. Copyright., 2013. Nolan, Mary. Visions of Modernity: American Business and the Modernization of Germany. Oxford: Oxford University Press, 1994. Thompson, Fred. "Fordism, Post-Fordism and the Flexible System of Production." n.d. Willamette University. 12 April 2014 . Read More