I’ve recently learned what the Gini Coefficient is and what it tells us. Basically, it is a score from 0 to 1, based on various national income and wealth data that is used by the UN to understand the level of income inequality in countries. The top ten countries having the lowest income inequality have scores from .226 through .265 (all Nordic and Central European countries). The worst is South Africa, at .63. The USA is .418. The global average is .35.<\/p>\n\n\n\n
Now, I’m fully aware that some people may challenge this sort of data and say it doesn’t reflect the full reality, etc., but it is considered the international standard used for measuring income equality. So, we can reasonably accept that it is a fairly reliable measure.<\/p>\n\n\n\n
The USA experienced a ‘great compression’ of this measure from 1940-1970, when the difference in the lowest wages versus the highest salaries in the economy narrowed from previous highs all the way to a score of .348. The lowest score for the U.S. came in 1980 at .347. But, since then, it has been on a continuous climb up (some anomaly around the pandemic times excluded). It is now .418 and expected to keep climbing. Right now, it is already in the top 20% of countries globally for level of income inequality. This is worse than all European countries and roughly equal with Russia, a country run by oligarchs. In short, not ideal.<\/p>\n\n\n\n
For comparison, Norway’s score is the lowest in the world at .226. The average CEO of a Norwegian company earns 3-to-5 times as much as a manual worker. In the USA, according to the AFL-CIO, that ratio is 281 times as much. Dramatic.<\/p>\n\n\n\n
In my professional life, I’ve had the opportunity to work with some Norwegian companies (including visiting them on a few occasions) and have seen this equality in practice. It works. And, Norway is most definitely a thriving democracy with an open and capitalist economy. A model of an open society. Plus, with a state healthcare system ranked as one of the best in the world. In defense, they spend a similar percentage of GDP as the United States (percentage of GDP being a commonly accepted comparison between countries for defense expenditure comparison).<\/p>\n\n\n\n
And here’s the final ‘catcher’: income equality in Norway appears to be achieved more through negotiation and consensus versus government-led taxation\/redistribution. Society accepts that it is better for everyone to live more equally and it simply has become a cultural norm.<\/p>\n\n\n\n
Outside of the blaring headlines and angry commentary often online, the data behind income equality in the United States starts to paint a clear picture for anyone who wants to reasonably assess this issue. And it’s an issue that needs to be addressed. Those of us who are Gen X-ers grew up just as this inequality was taking off, so maybe we have a particular responsibility to do something about it. Can Gen X-ers reinvent economic life in the mold of our grandparents and work to bring about another ‘great compression’ for the next generations?<\/p>\n","protected":false},"excerpt":{"rendered":"
I’ve recently learned what the Gini Coefficient is and what it tells us. Basically, it is a score from 0 to 1, based on various national income and wealth data that is used by the UN to understand the level of income inequality in countries. The top ten countries having the lowest income inequality have […]<\/p>\n","protected":false},"author":5,"featured_media":1357,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"off","_et_pb_old_content":"","_et_gb_content_width":"1080","footnotes":""},"categories":[18],"tags":[],"class_list":["post-1356","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles"],"_links":{"self":[{"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/posts\/1356","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/comments?post=1356"}],"version-history":[{"count":7,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/posts\/1356\/revisions"}],"predecessor-version":[{"id":1395,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/posts\/1356\/revisions\/1395"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/media\/1357"}],"wp:attachment":[{"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/media?parent=1356"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/categories?post=1356"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mbafamily.org\/index.php\/wp-json\/wp\/v2\/tags?post=1356"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}