Political causes alongside sociological theories are used to explain rise in income inequality in South Africa (SA). The economic inequality is viewed from variety of angles including the political inequality. Researchers show that politicians in SA are becoming more responsive to political preferences of affluent citizens than to poor citizens (Ahmad 18). Policies directed toward promoting the interests of affluent while poor or middle class citizens remain uncovered by the political umbrella. Political inequality goes hand in hand with wealth inequality. In societies where incomes are equally distributed, political equality is also realized. The purpose of this paper is to identify the sources of wealth inequality in South Africa in the second half of the 20th century by class with an emphasis on political and policy sources. Consequences of wealth disparities and public policies adopted to address the economic inequality are also discussed.
Source of wealth inequality gap
Wealth can be defined as the net worth of a person. These includes all the personal assets minus the liabilities. The assets includes any physical belonging and personal savings. South Africa exhibits wider disparities of wealth between the rich and poor than any other developed country. Over the 20th century, the share of America’s wealth possessed by the rich has drastically increased with an equal decrease in wealth held by the nation’s poorest (Timmons 752). The average American has not experienced an improved wealth share with households falling in 2000 and 2011.
Political system has shifted toward emphasizing on the interests of the rich while ignoring the interests of the poor therefore creating wealth disparities. A political system that emphasized on needs of unions and one that does not get controlled by the rich would form a desirable political system. The main causes of wealth inequality is political inequality where policies that promote wage stagnation are promoted by the powerful and leave the poor suffering (Isaac 572). Income inequality and wage stagnation have roots in economics and politics of a country.
Political races are expensive and candidates seek support from other wealthy individuals to promote their campaign. Political inequality and economic inequality forms a vicious cycle in that one cannot achieve political equality if they have limited wealth resources (Solt 57). When a candidate is elected, they focus on pleasing their friends who form the wealthiest class of people in America. Policies that promote the welfare of the rich are implemented first with little attention given to a poor citizen who has nothing to offer during the campaigns. Corruption with the politicians also influences the economic disparity in America.
Consequences of wealth inequality gap
Greed has made the world to be full of hate, and people are busy scrambling for wealth instead of focusing on making the world better place for anyone alive and the future generation. The knowledge that people are gaining does not make the world better since people think too much and feel too little. Humanity is needed more than machinery and cleverness. Kindness and love are some of the qualities that human beings should embrace. With all the evil in the world, the dictators will die, and the right leaders of the future shall be born.
Public policies adopted to address wealth gap
Poverty Reduction is a set of measures which aims at uplifting people from poverty. This measures the can either be permanent or humanitarian. Poverty reduction has been a challenge in both developed and developing countries with most people living below poverty line. This is mainly due to changes leading to economic growth. These two articles have therefore provided both long-term and short-term solutions to the problem. Which can be adopted in different countries.
“Aid, Growth, and Job” focuses on poverty as a challenge not only in Africa but the whole world (Heumann 300). Heumann first defined the problem before addressing it deeply. According to the writer, poverty is a result of employment problems. Unemployment in developing countries is higher than in developed countries. Most people are, therefore, poor because they lack employment and those who are employed are also poor because they are not compensated adequately despite long working hours. Due to this fact, they spend most of their time at work which they are inadequately remunerated. In addition, other jobs are seasonal, and their certainty cannot be predicted. Fluctuations in jobs contribute to poverty because stabilization is a challenge to workers (Ward 44). On the other hand, those jobs which are secure and well-paying are few as compared to the population especially in developing countries. Again, developing countries aim at creating employment opportunities without paying attention to the earnings in the existing jobs, therefore making it hard to eradicate poverty.
Wolfe identifies some of the policies which can be adopted to help curb unemployment problems. However, these policies will not work unless they are implemented. Economic growth is essential for economic development, but it is not a necessary condition. International trade should not be eliminated but should be limited since it oppresses the poor and only a few people can benefit from it. The way in which foreign aid is spent should also be an area of concern in third world countries. The writer also focuses on the idea of helping the poor earn more from their work as it is a way of eliminating poverty.
“Growth and Employment in Africa” has narrowed down the scope of growth and employment in Africa (Fenna and Tapper 195). From the article, Africa has experienced a slow rate of growth despite the significant flow of foreign investment, improved education, health services, and increased GDP. The writer identifies various challenges associated with the slow rate of growth and unemployment in Africa. The quality and sustainability of Africa’s growth rates have raised a lot of concern. Economists strive to understand why Africa’s recent growth is as a result of a change in the structural transformation where a worker moves from low productivity labor to a higher productivity labor. This transition should not be the case, especially where industries are not developing like in Africa. Despite the development of social sectors in Africa, the problem of unemployment has still continued to exist. The economy has been unable to provide sustainable jobs to their growing population. From the research conducted, high levels of unemployment are as a result of poor government management of funds. The author also focuses on how the allocation of foreign aid has slowed down the rate of growth and development in Africa.
Most aid funds have been used to improve social sectors, but recently this has changed. Since employment has been identified as an immediate need, most funds are now channeled to the private sector to solve the unemployment problem. The article also provides solutions for unemployment through handling issues related to foreign aid because allocation of foreign aid should aim at creating employment opportunities. By providing an overview of labor markets, the author noticed that the primary challenge in developing countries is not employment, but the income generated from work. Measures to be taken should, therefore, focus on improving the wages (Thompson 317). Channeling foreign aid to the private sector can also help solve unemployment and earning problems. Through the realization of structural change, poverty can be reduced as well.
Various factors influence inequality. These factors involve foreign aid policies, unemployment problems, and small earnings. Researchers elaborate on how foreign aid should be appropriately used to increase job opportunities which can be achieved by allocating more funds to the private sector (Frijters and Foster 72). By increasing the earnings then poverty can be reduced. In the two articles, policy makers are encouraged to formulate policies which do not only cater for growing demand for jobs, but also the wages earned in the jobs. Both authors also came up with similar interventions for the challenge. They identified economic growth as a key factor in development. In the first article, economic growth is seen as a solution to unemployment. In the second article, it is termed as a structural change in various sectors and can be used as a ladder to move from lower productivity labor to higher productivity jobs. Investing in the private sector has been identified as a way of poverty reduction in both articles. According to the articles, most non-governmental agencies, individuals, and aid agencies willing to support the poor should focus on funding the private sector more. Lastly, the two reports have come to an agreement that self-employment is a way of reducing poverty and economies should look for ways of increasing earnings from self-employed jobs.
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