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America Is Even More Unequal than It Seems

Research & Commentary
October 22, 2012

by Salvatore Babones

We all know that the United States is the most unequal of the rich nations of the world.  Only relatively poor countries like Malaysia and Mexico have levels of inequality similar to those in the United States.  All of the rich countries of western Europe and east Asia have much lower levels of inequality than we do.

The real situation, however, is worse than the income data would suggest.  Data on income inequality only tell half the story.  The differences in the ways people live are only partly determined by income.  They’re also determined by the levels of government services provided to everyone.

This is most obvious when it comes to healthcare.  In the rest of the developed world, everyone has health insurance.  Depending how you count, about a quarter of working-age Americans don’t.  Real inequalities in health coverage are even greater, since the richest Americans tend to have the best insurance.

Healthcare is only the beginning.  In the European Union, everyone is guaranteed at least four weeks’ paid vacation.  In the United States, the higher your income the more vacation you get.  So paid vacations tend to level out life experiences in Europe but create more inequality in the United States.

[pullquote]Only relatively poor countries like Malaysia and Mexico have levels of inequality similar to those in the United States.[/pullquote]

Most developed countries have cheap, accessible mass transportation systems.  America doesn’t.  Mass transit levels out life experiences because everyone, rich or poor, can take a tram, and everyone on a tram has the same experience.  In the US, where people are forced to drive, the rich have much more luxurious driving experiences than the poor.

And so it goes: public schooling, public parks, social work services, paid sick leave, paid parental leave, government-supported childcare, and all the other things that governments do tend to level inequality more in the rest of the world than they do in the United States.

As a result, the experience of life abroad is much more the experience of relative equality than it is in the US.  Life in America is highly stratified, from our highways to our prisons.  Life abroad is still stratified, but much less so.  All you have to do is take a bus in Europe or Japan to see firsthand how true this is.

Life in America is much more unequal than it seems at first glance from income statistics.  Given how unequal the income statistics are in the first place, this is shocking.  If you don’t believe how different things are overseas … travel and see it for yourself.  Life can be better — and we can make it so.

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