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How much more buying power do wealthy elites need?

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Wealth inequality has long been rooted in our country’s history with tense relationships between workers and bosses, and corporations and unions. In the past five years or so especially, we have seen efforts to hike minimum wages up to a $15 per hour — a “livable wage,” slightly over twice as much as the current federal minimum wages. These wages have not risen since 2009, despite ever-deepening economic turmoil and inflation.

In 2019, we have seen delinquency rates skyrocketing in multiple industries. The Washington Post reports record high numbers of Americans are behind on automobile payments, which signals “significant duress among low-income and working-class Americans.” Car payments are generally prioritized first and foremost because transportation is needed to travel to and from work, and if absolutely necessary, one can live in a car.

Unemployment is currently hovering around 4 percent, a safe, low number. But a record number of Americans who are unable to afford crucial payments suggests that wages are remarkably lower than they should be, Americans have too many competing debts and high interest rates — or both.

According to a Bloomberg report, the rate of delinquency on student loan payments is also precariously high and continues to climb even as unemployment rates shrink. There is currently over $166 billion owed in student loans.

We can see the student loan industry is having very real consequences on not only students, but the schools themselves. As many students begin to see the costs of higher education outweighing the potential benefits, there are fewer applicants.

To offset this trend, even Allegheny College has consistently raised the cost of attendance, now totalling a staggering $63,000 each year, and acceptance rates continue to decrease while little is offered to students who continue to pay increasingly large sums each year.

Naturally, this results in a snowball effect: in order to counter financial delinquency and its effects on an institutional level, students must delve ever further into debt, perpetually contributing more and more to the unsustainable economic dilemma.

Perhaps the biggest barrier we face is our inability to grasp the gravity of the situation. For example, if minimum wage was raised to $15 per hour — what most Americans would consider “livable” and certainly a radical and progressive move — a full-time worker would make $31,200 before tax deductions. According to national poverty rates, this amount would keep a household of three above the poverty line, and for a two-person household, money would still likely be tight.

Today, the federal minimum wage is less than half of that rate, with a full-time worker earning an annual salary of $15,080, making it extremely difficult to support even themselves, keeping them well below the poverty line. It just seems nonsensical that the same government, and even closely related agencies, will define what constitutes poverty and declare minimum wages that keep citizens below the poverty line.

It is also difficult to wrap our heads around the massive figures needed to perform any sort of analysis. For example, the wealthiest 1 percent of people hold 38.6 percent of wealth while the poorest 90 percent holds just under 23 percent.

More starkly, Amazon CEO Jeff Bezos is currently worth about $140 billion — this one man could pay the majority of all student loan debt in America.

The Guardian reports that it would cost about $216 million to fix the contaminated water pipelines in Flint, MI, so Bezos could theoretically address the issue with approximately one-tenth of 1 percent of his wealth. For the “low” cost of $20 billion annually, or one-seventh of his wealth, Bezos could eradicate homelessness in America and still have over $100 billion to play with. Or perhaps Bezos could spend $30 billion annually to end world hunger?

I use Jeff Bezos, the richest man in the world, as an example. It’s unfair to fault him for not fixing everything he has the buying power to fix and it is hard to argue that he should not be allowed to be wealthy. But with unlimited buying power, is it unreasonable to expect a little bit of good in return?

Bezos has donated $33 million in scholarships for Dreamers, $25 million to New York University Langone Hospital, and another $2.5 million to Washington United for Marriage to support same-sex marriage. These are great things to support, but these amounts are relatively miniscule, totaling slightly less than 20 percent of 1 percent of his wealth, or about .04 percent — a percentage about 250 times less than an average family tithing to a church.

Meanwhile, the company worth $800 billion paid absolutely nothing in income taxes, even receiving a rebate making their tax rate negative 1 percent. Amazon has been under fire for overworking their workers and treating them with extreme disposability — and why? Bezos could pay and treat his workers well and still have a 12-digit net worth.

I have difficulty rectifying personal rights and humanitarian issues. On one hand, I have trouble thinking that wealthy people should be expected to solve problems in society if they are able to. But on the other hand, I lack sympathy knowing that the vast majority of Americans are competing for inadequate salaries for jobs they don’t particularly want to do — and many of these problems are directly related to the hoarding of wealth.

A common argument against raising the minimum wage compares fast food workers and paramedics. Why should they get paid the same wage? Paramedics have a more specialized skill set and are immediately more consequential to our social fabric, but does that mean that unspecialized workers don’t deserve a living wage? Why don’t we raise both wages?

The concentration of wealth illustrates, if nothing else, that there is room for growth. As one Texas paramedic, who weighed in on the matter said, “…that’s exactly what the bosses want! They want us fighting over who has the most crumbs so we don’t realize they made off with almost the whole damn cake.”

I certainly advocate for higher wages and wealth distribution, loan forgiveness, a universal basic income and other economically progressive matters, but it is hard to say what needs to happen to restore a sense of equity and an empowered working class. Wealth inequality today is approaching the levels that were last seen in the 1920s immediately before the Great Depression, which is worrying considering that humans have an unfortunate tendency of waiting too long to address urgent issues.

There is more than enough money in the world to drastically improve the lives of common citizens, but still, people starve, go homeless, lack healthcare and education, and barely scrape by paycheck to paycheck. And it’s like that because some people, organizations, and governments — those with enough money to single-handedly fix national and worldwide issues by simply allocating funds — want it to be that way.

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About the Writer
Shane Ostrom, Opinion Editor

Shane is a senior majoring in communication arts and minoring in journalism in the public interest. Having come all the way from Denver, Colorado, to attend...

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How much more buying power do wealthy elites need?