Inequality

Inequality is a large issue and there's different types of inequality, such as economics, social, and political inequalities. In history class, we were shown a video that showed the distribution of wealth in America. It got me thinking about inequality because I lived in a country where there was major inequality, the country was corrupt politically, which caused even more inequality as some would be very rich officials and others scraping for a single penny. This video shocked me because it mentions how the top 1% of the American population were billionaires and how the first 20-30% were just at the poverty line for America. However, the poverty in America is much different from the poverty line in Cambodia, where I came from, as in America, you can easily get a job, your kids can go to school for free and get a decent education, government helps those in that situation. In Cambodia on the other hand, they don't have the free quality education like in America, they don't have easy access to jobs, and they don't have government support. 

This video had triggered those thoughts, because it's not just Cambodia, there is Myanmar, Bangladesh and parts of India in the same situation, and probably many more countries.  

Here's a diagram which shows the figures and help grasp a better understanding. 

This diagram shows two types of distribution, one the wealth and the other the income. As we can see the majority have a relatively high income, however on the opposite spectrum there is the poorer civilians who don’t make much, just enough to have a living.

As you can see the inequality in Latin America has been traced back to 1491. In 1492 the Spanish started to colonize Latin America which started the increase in Gini coefficients in Latin America. It is said that the Gini coefficient was 12-13% higher than the native empires. The Iberians replaced the native empires and raised the extraction rate for their purposes. Also in the 16^th century there were demographic issues. When the Europeans started to colonize Latin America and brought over their animals, horses, who carried a unknown disease that was deadly and caused a lot of harm to the native empire. This increased the land to labor ratio which then increased the GDP per capita. This was the Iberians opportunity to exploit the natives and this is when the social inequality evolved in Latin America. Because of this, however, the GDP per capita increased as well as urbanization. It did cause an increase to the Gini coefficient and the land to labor ratio fell, which helped encouraged inequality. Then there was the independence hence the prediction of a fall between 57.6 and 47.0 in the Gini coefficient.

Social and economic inequalities are everywhere. In any business industry there are many different inequalities, such as the difference between employees and employers, and CEOs. There's an inequality there because the CEO comes up with the idea and starts the production, however after that they step out of the picture more, then the employers and employees are running the business. Though the employees and employers are running the business, the CEO is getting most of the money, though they aren't doing very much field work and the employees and employers are getting less though they are running the business. There's also an inequality between the employers and the employees, because the employers hire the employees to do the work, which puts less work on the employers, who are getting paid more.

Here's a diagram of a typical hierarchy in a business and the top level of the hierarchy tend to be the people who get paid the most.

Without any one of these components a business won't function well, however the work distribution tends to be uneven, as the managers and the operation level employees are doing most of the field work and the CEO just oversea the business, yet they get paid the most.

"According to the document, Cook's $9.22 million in earnings includes $1.75 million salary, $6.7 million in non-equity incentives and other company contributions. Apple notes Cook was paid out nearly $57,000 in vacation cash-out and accrued almost $700,000 in security expenses." - This is about the salary of Tim Cook who is the CEO at Apple. The director of engineering at apple earns $102,994 – $261,175, and they are the ones on the ‘field’ working and designing the Apple products.

"The top leadership team at Samsung, made up of its three co-CEOs and CFO, makes $30.6 million combined, the Sowan, Korea-based company revealed at its annual shareholder meeting."- This is about the salaries that the CEOs at Samsung.  The Samsung Director gets roughly $69,000, but it’s dependent on the location and the industry.

As we can see from these figures there’s a relatively large margin between the CEOs and the Directors. The CEOs salaries are higher mainly because they are the ones who are responsible for what goes on with the business, whether it fails or its successful.

The Director on the other hand is in charge of different or specific departments/industries of the business. They are hired by the CEO but are responsible for managing other employees, hiring employees and in charge of the on field work needed.

This leaves me to question, why is there a relatively large margin of salaries between jobs? There’s an even larger one between the managers and the CEOs, which I won’t touch upon.  

I feel strongly about inequality, coming from a country that suffers in poverty and then seeing America, its a strong difference. I've been hearing complaints from people who say they are poor, yet they have food, shelter, and free education, then on the opposite spectrum, there are those who have no food, no shelter, and no education (at least not a good education). Within Cambodia (where I lived for the past 7 years), there are defined economic inequalities. There are those officials who drive in Lexus's, have latest technology, and big large houses, and then there are those who have to dig in the trash for food and live on the streets. It's heartbreaking to see this, yet it's something that's hard to stop. Ideally we want to, however in reality, it's hard to break inequality, because it’s become a cycle, known as the poverty cycle (in this situation). However, we can help out by simply giving just a little of our savings to help those families who are stuck in the poverty cycle, or giving them the basic knowledge (teaching them English) to get a decent job in that country, to feed their families. Most girls and young ladies sell themselves into prostitution because it’s a ‘good’ paying job without needing any real skills and they are stuck in that mind set, because they don’t know anything else. If we teach them, they can break that cycle, it takes courage and boldness.