Winner-take-all philosophy extends poverty

By Neeraj Salhotra     9/30/10 7:00pm

"I make an obscene amount of money," one CEO proclaimed at a recent talk I attended. "All CEOs of Fortune 500 companies make too much money," he continued. He then quickly moved onto the next topic as if cursorily mentioning the issue was enough. It was that comment and my subsequent research into CEO salaries (on average, 200 times greater than that of the average worker) that inspired this piece.In our winner-take-all culture, we value the superstars, the CEOs and the elite to such an extent that we neglect the masses of the country. We insist on paying LeBron James almost $15 million annually, yet we cannot pay our teachers even $50,000. We reward our CEOs with million-dollar stock options and bonuses, yet, to quote Vice President Joe Biden, "[CEOs] make $10,000 more in one day than the average worker makes in a year." We watch in admiration as 58 percent of real income growth from 1976 has gone to the top 0.1 per- cent of Americans while the salaries of middle-class Americans have been virtually stagnant.

The most insidious form of our

winner-take-all psyche has been the actions of our government. Consider that our government spent $700 billion bailing out financial institutions, yet struggles to spend $50 billion to provide jobs for more than 9.6 percent of Americans who are unemployed.

---

---

Consider that Warren Buffet pays a lower tax rate than his secretary. Consider that our payroll and Social Security taxes are regressive. I could go on ad nauseam with statistics; however, one fact truly illustrates our current predicament: Since 1981 the wealthiest 0.1 percent of Americans have nearly tripled their portion of the country's wealth; yet, while the elite amassed such wealth, our government actually decreased their tax rate.

This winner-take-all philosophy has most disturbingly engendered poverty in the U.S. Simply put, our fascination with the wealthy has been coupled with an abandonment of the middle and lower classes. This poverty is not just a statistic. No, it is a real problem. It is that family that cannot pay for their children to attend college. It is that family that cannot afford adequate health care for their loved ones. It is Jessica Staley, a teenager who wants to attend her high school prom but cannot afford a dress.

Recently, the Census Bureau estimated that 43.6 million, or about 14 percent of Americans, live in poverty. That is, a family of four earns less than $21,954 in annual pre-tax income. The notion that one-seventh of our fellow citizens live in poverty is unacceptable.

If we are able to sit idly and watch while our countrymen wallow in poverty, we must question the nation we are.

Our admiration for the elite has led to unprecedented poverty, but we can still ameliorate the situation. The pragmatic and implementable answer to our predicament is a check on our winner-take-all mentality. The government must spearhead such an effort by amending our tax code in two key ways: increasing the capital gains tax so that Warren Buffet pays a higher tax rate than his secretary and returning the highest marginal tax rate back to its Clinton-era position of 39.6 percent.

The government must also further develop programs for the poor and middle classes that provide affordable education, low-cost health care and meaningful employment. As for the private sector, we must all internalize our responsibility to our fellow Americans and volunteer our time, money and effort to those less fortunate than ourselves. The governmental initiatives supplemented by private sector actions will both help us begin to cast aside the winner-take-all persona that currently defines the U.S. and improve the plight of more than 43 million Americans living in poverty. If we do not take such actions, we may find ourselves living in a society where the wealthiest 0.1 percent of Americans control 20 percent of the wealth, while more than 20 percent of Americans live in poverty.

Neeraj Salhotra is a Sid Richardson College sophomore.

---