Inequality

Part of Bird’s Eye View

Increasing Income or Wealth Gap. In other words, the disappearing middle class.

But, why does this matter?

Because democracy cannot function if the Middle Class is not the majority.

Why is that?Aristotle-Raphael

Aristotle summed it up over 2400 years ago, but for those who don’t want to read more than a few sentences, this is what he said.

  1. In a democracy, the MAJORITY has to be the middle class because they are smart enough and have just enough wealth, that they can see themselves becoming rich some day, so they don’t punish the rich and they have compassion for the poor.
  2. If the poor become a majority, they will vote to punish the rich.
  3. The rich, on the other hand, knowing that the poor are out to get them, will do everything in their power to prevent the poor from hurting them, i.e: from voting.
  4. Therefore, the two extremes (the rich or the poor) cannot be in control in a democracy, only the middle class being in control works.

This is already happening in our world, check this out:

A recent study at Princeton and Northwestern Universities has shown that corporations and the rich have all the influence on Government policy while the middle class has ZERO influence:

zeroinfouice

The result of this influence is that the middle class is disappearing – note this chart from the Federal Reserve Board:

middle-class

This chart below shows how drastically things have changed in our time-period vs. other time-periods:

Distribution of average income during expansion periods
Distribution of average income during expansion periods

So, as you can see from the few charts, the middle class is disappearing and exactly what Aristotle talked about is happening.

That, my friends, is why the widening income/wealth gap and the disappearing middle class are not good for democracy.