Chapter 7 Chapter 7 Social Social

Stratification: Stratification: United States and United States and

Global PerspectivesGlobal PerspectivesMelanie HatfieldMelanie Hatfield

Soc 100Soc 100

WealthWealth

Your wealth is what you own.Your wealth is what you own. A house (minus the mortgage), a car A house (minus the mortgage), a car

(minus the car loan), and some (minus the car loan), and some appliances, furniture, and savings appliances, furniture, and savings (minus the credit card debt).(minus the credit card debt).

Bill GatesBill Gates

WealthWealth

In the mid-1990s:In the mid-1990s: The richest 1% of American households The richest 1% of American households

owned nearly 39% of all national wealth.owned nearly 39% of all national wealth. The richest 10% owned almost 72%.The richest 10% owned almost 72%. The poorest 40% of American The poorest 40% of American

households owned .2% of all national households owned .2% of all national wealth.wealth.

The bottom 20% had negative net The bottom 20% had negative net worth.worth.

Patterns of Wealth Patterns of Wealth InequalityInequality

Wealth inequality has been increasing since Wealth inequality has been increasing since the early 1980s.the early 1980s.

62% of the increase in national wealth in 62% of the increase in national wealth in the 1990s went to the richest 20%.the 1990s went to the richest 20%.

The US has surpassed all other highly The US has surpassed all other highly industrialized countries in wealth industrialized countries in wealth inequality.inequality.

Between 50 and 80% of the net worth of Between 50 and 80% of the net worth of American families now comes from American families now comes from transfers and inheritances.transfers and inheritances.

Policies that seek to redistribute income Policies that seek to redistribute income from the wealthy to the poor may not get at from the wealthy to the poor may not get at the root of economic inequality.the root of economic inequality.

The Distribution of The Distribution of National Income among National Income among

Households, USHouseholds, US

Global InequalityGlobal Inequality

Almost 20% of the world’s Almost 20% of the world’s population lacks adequate shelter.population lacks adequate shelter.

Over 20% lacks safe water.Over 20% lacks safe water. About 1/3 of the world’s population About 1/3 of the world’s population

are without electricity.are without electricity. Over 40% lack adequate sanitation.Over 40% lack adequate sanitation. In the US, there are 626 phone lines In the US, there are 626 phone lines

for every 1,000 people, but in for every 1,000 people, but in Cambodia, Congo, and Afghanistan Cambodia, Congo, and Afghanistan there is only 1 line per 1,000 people.there is only 1 line per 1,000 people.

Global InequalityGlobal Inequality Annual health expenditures in the US is $2,765 Annual health expenditures in the US is $2,765

per person, whereas in Vietnam it’s $3 per per person, whereas in Vietnam it’s $3 per person. person.

The average education expenditure for an The average education expenditure for an American child is $11,329 per year, compared American child is $11,329 per year, compared with $57 in China.with $57 in China.

The richest 10% of Americans earn 10,000 times The richest 10% of Americans earn 10,000 times more than the poorest 10% of Ethiopians.more than the poorest 10% of Ethiopians.

There are still about 27 million slaves in There are still about 27 million slaves in Mozambique, Sudan and other African countries.Mozambique, Sudan and other African countries.

InequalityInequality

Global Inequality: Differences in the Global Inequality: Differences in the economic ranking of countries.economic ranking of countries.

Crossnational variations in internal Crossnational variations in internal stratification: Differences between stratification: Differences between countries in their stratification countries in their stratification systems.systems.

Measuring Internal Measuring Internal StratificationStratification

The The Gini indexGini index is the measure of is the measure of income inequality. Its value ranges income inequality. Its value ranges from zero (which means that every from zero (which means that every household earn exactly the same household earn exactly the same amount of money) to one (which amount of money) to one (which means that all income is earned by a means that all income is earned by a single household).single household).

Household Income Household Income InequalityInequality

Inequality and Inequality and DevelopmentDevelopment

Foraging Societies Foraging Societies

Societies in which people live by Societies in which people live by searching for wild plants and searching for wild plants and hunting wild animals.hunting wild animals.

Predominated until about 10,000 Predominated until about 10,000 years ago. years ago.

Inequality, the division of labor, Inequality, the division of labor, productivity, and settlement size are productivity, and settlement size are very low in such societies.very low in such societies.

Horticultural and Pastoral Horticultural and Pastoral SocietiesSocieties

About 12,000 years ago, people About 12,000 years ago, people established agricultural settlements established agricultural settlements based on horticulture and pastoralism.based on horticulture and pastoralism.

These innovations enabled people to These innovations enabled people to produce a surplus above what they produce a surplus above what they needed for subsistence.needed for subsistence.

A small number of villagers controlled A small number of villagers controlled the surplus and significant social the surplus and significant social stratification emerged.stratification emerged.

Agrarian SocietiesAgrarian Societies

People developed plow agriculture about People developed plow agriculture about 5,000 years ago and were able to 5,000 years ago and were able to increase production and surpluses.increase production and surpluses.

Agrarian societies developed religious Agrarian societies developed religious beliefs justifying steeper inequality.beliefs justifying steeper inequality.

People viewed large landowners as People viewed large landowners as “lords.”“lords.”

If you were born a peasant, you and your If you were born a peasant, you and your children were likely to remain peasants.children were likely to remain peasants.

Industrial Societies Industrial Societies

Emerged in Great Britain in the Emerged in Great Britain in the 1780s.1780s.

Productivity, the division of labor, Productivity, the division of labor, and settlement size increased and settlement size increased substantially.substantially.

Social inequality was substantial Social inequality was substantial during early industrialism and during early industrialism and declined as the industrial system declined as the industrial system matured.matured.

Postindustrial SocietiesPostindustrial Societies Societies in which most workers are Societies in which most workers are

employed in the service sector and employed in the service sector and computers spur increases in the division of computers spur increases in the division of labor and productivity.labor and productivity.

Shortly after World War II, the U.S. became Shortly after World War II, the U.S. became the first postindustrial society and led the the first postindustrial society and led the world into an era of prosperity social world into an era of prosperity social equality under the liberal “Development equality under the liberal “Development Project” up to early 1970sProject” up to early 1970s

In most of the world, social inequality has In most of the world, social inequality has been increasing - and accelerating - since been increasing - and accelerating - since early 1970s., under the neoliberal early 1970s., under the neoliberal “Globalization Project “Globalization Project

Marx’s Theory of Marx’s Theory of Stratification Stratification

During the Industrial Revolution industrial owners were During the Industrial Revolution industrial owners were eager to produce more efficiently to earn higher profits, eager to produce more efficiently to earn higher profits, their competition drove them to ceaseless innovations, their competition drove them to ceaseless innovations, higher concentration, and increasing the absolute & higher concentration, and increasing the absolute & relative exploitation of their labor.relative exploitation of their labor.

Thus, as the ownership class (bourgeoisie) grew richer Thus, as the ownership class (bourgeoisie) grew richer and smaller, the working class (proletariat) grew larger and smaller, the working class (proletariat) grew larger and more impoverished: modernity led to exponential and more impoverished: modernity led to exponential social inequality.social inequality.

Marx believed that capitalist growth would inevitably Marx believed that capitalist growth would inevitably convulse in national proletarian revolutions, but also convulse in national proletarian revolutions, but also would lay, through “socialized production” the would lay, through “socialized production” the groundwork for a multistate world “socialist” society, groundwork for a multistate world “socialist” society, which would eventually lead to no more classes (or which would eventually lead to no more classes (or states) and therefore no more class/international states) and therefore no more class/international conflict: “communism” - no more social inequalities!conflict: “communism” - no more social inequalities!

Marx (cont.)Marx (cont.) Marx felt that industrial workers would ultimately Marx felt that industrial workers would ultimately

become aware of their exploitation: “class become aware of their exploitation: “class consciousness”consciousness”

This would encourage class organizastion and This would encourage class organizastion and mobilization in all “advanced” capitalist countries: mobilization in all “advanced” capitalist countries: the growth of unions & workers’ political parties.the growth of unions & workers’ political parties.

These “vanguard” organizations would eventually These “vanguard” organizations would eventually win state power and implement the socialist win state power and implement the socialist program: program: “From each according to their ability, to “From each according to their ability, to each according to their work”each according to their work”

usher a new “communist” world in which there usher a new “communist” world in which there would be no private wealth:would be no private wealth: “From each “From each according to their ability, to each according to according to their ability, to each according to their needs.”their needs.”

Critical Evaluation of Marx’s Conflict Critical Evaluation of Marx’s Conflict TheoryTheory

Why didn’t things work out the way Marx Why didn’t things work out the way Marx predicted? They did, up to WWII!predicted? They did, up to WWII!

1.1. After WWII industrial societies did not polarize After WWII industrial societies did not polarize into 2 opposed classes engaged in bitter conflict.into 2 opposed classes engaged in bitter conflict.

2.2. While Marx correctly argued that investment in While Marx correctly argued that investment in technology makes it possible for capitalists to technology makes it possible for capitalists to earn high profits, he did not expect investment earn high profits, he did not expect investment in technology to also make it possible for rich in technology to also make it possible for rich country workers to earn higher wages in the era country workers to earn higher wages in the era of imperialism: The New Deal! of imperialism: The New Deal!

3.3. Socialism took root not where industry was most Socialism took root not where industry was most highly developed, as Marx predicted, but in highly developed, as Marx predicted, but in semi-industrialized countries such as Russia in semi-industrialized countries such as Russia in 1917 and in the colonial world (after China in 1917 and in the colonial world (after China in 1948)1948)

Functionalist theories of Functionalist theories of inequality: inequality:

The Davis-Moore ThesisThe Davis-Moore ThesisThis theory argues that inequality is necessary This theory argues that inequality is necessary

and desirable:and desirable: Jobs in modern society differ in importance.Jobs in modern society differ in importance. How can the limited number of talented How can the limited number of talented

people be motivated to undergo the long people be motivated to undergo the long training they need to serve?training they need to serve?

The incentives are money and prestige.The incentives are money and prestige. Social stratification is necessary (or Social stratification is necessary (or

“functional”) because the prospect of high “functional”) because the prospect of high rewards motivates people to undergo the rewards motivates people to undergo the sacrifices needed to obtain higher education, sacrifices needed to obtain higher education, etc., in a meritocratic society.etc., in a meritocratic society.

Critical Evaluation of Critical Evaluation of FunctionalismFunctionalism

1.1. The question of which occupations are The question of which occupations are most important is not clear-cut. Also, most important is not clear-cut. Also, what kind of “job” is being rich by what kind of “job” is being rich by inheritance?inheritance?

2.2. It stresses how inequality helps society It stresses how inequality helps society discover talent, but it ignores the pool discover talent, but it ignores the pool of talent lying undiscovered because of of talent lying undiscovered because of inequality.inequality.

3.3. It fails to examine how advantages are It fails to examine how advantages are passed from generation to generation.passed from generation to generation.

Weber’s Theory of Weber’s Theory of StratificationStratification

Like the functionalists, Max Weber Like the functionalists, Max Weber argued that the emergence of a argued that the emergence of a classless society is highly unlikely.classless society is highly unlikely.

Like Marx, he recognized that under Like Marx, he recognized that under some circumstances people can act to some circumstances people can act to lower the level of inequality in society.lower the level of inequality in society.

Weber recognized that 2 types of Weber recognized that 2 types of groups other than classes – status groups other than classes – status groups and parties – have a bearing groups and parties – have a bearing on the way society is stratified.on the way society is stratified.

Weber’s Stratification Weber’s Stratification SchemeScheme

Social MobilitySocial Mobility Peter Blau and Otis Dudley Duncan did Peter Blau and Otis Dudley Duncan did

work on social mobility – work on social mobility – The American The American Occupational StructureOccupational Structure (1967). (1967).

They took on the task of figuring out the They took on the task of figuring out the relative importance of inheritance vs. relative importance of inheritance vs. individual merit in determining one’s individual merit in determining one’s place in the stratification system.place in the stratification system.

Blau and Duncan’s answer was that Blau and Duncan’s answer was that America is based mainly on individual America is based mainly on individual achievement heavily influenced by family achievement heavily influenced by family & educational factors.& educational factors.

Blau and Duncan’s Model Blau and Duncan’s Model of Occupational of Occupational Achievement Achievement

Social MobilitySocial Mobility

Other research has shown that from WWII-1960s:Other research has shown that from WWII-1960s: The rate of social mobility for men in the US The rate of social mobility for men in the US

was high and that most mobility was upward.was high and that most mobility was upward. Mobility within a single generation Mobility within a single generation

(intragenerational mobility) was generally (intragenerational mobility) was generally modest.modest.

Mobility over more than one generation Mobility over more than one generation (intergenerational mobility) could be (intergenerational mobility) could be substantial.substantial.

Most social mobility was the result of change in Most social mobility was the result of change in the occupational structure (known as structural the occupational structure (known as structural mobility).mobility).

There was only small differences in rates of There was only small differences in rates of social mobility among the highly industrialized social mobility among the highly industrialized countries.countries.

Group Barriers to Upward Social Group Barriers to Upward Social Mob.Mob.

If you compare people with the same If you compare people with the same level of education and similar family level of education and similar family backgrounds, women and members backgrounds, women and members of racial/ethnic minority groups tend of racial/ethnic minority groups tend to attain lower status than white to attain lower status than white men.men.

The existence of such group The existence of such group disadvantages suggests that disadvantages suggests that American society is not as open as American society is not as open as Blau and Duncan made it out to be.Blau and Duncan made it out to be.

Prestige and PowerPrestige and Power

Inequality is not based on money Inequality is not based on money alone but also on prestige and power.alone but also on prestige and power.

Members of status groups tend to Members of status groups tend to signal their rank by means of material signal their rank by means of material and symbolic culture.and symbolic culture.

They seek to distinguish themselves They seek to distinguish themselves from others by taste in fashion, food, from others by taste in fashion, food, music, literature, manners, and travel, music, literature, manners, and travel, all of which is subject of mass all of which is subject of mass marketing: cat & mousemarketing: cat & mouse

PowerPower Power is a second non-economic Power is a second non-economic

dimension of stratification: the ability to dimension of stratification: the ability to have commands obeyed.have commands obeyed.

Power has a profound impact on the Power has a profound impact on the distribution of opportunities and rewards distribution of opportunities and rewards in society.in society.

Power is exercised formally in politics, Power is exercised formally in politics, and politics can reshape the class and politics can reshape the class structure by changing laws governing structure by changing laws governing people’s rights to own property, have people’s rights to own property, have access to opportunities & benefits, etc.access to opportunities & benefits, etc.

U.S. Politics and the Plight of U.S. Politics and the Plight of the Poor since 1980the Poor since 1980

Broadly speaking, most Democrats want Broadly speaking, most Democrats want government to play an important role in government to play an important role in helping to solve the problem of poverty.helping to solve the problem of poverty.

Most Republicans want to reduce Most Republicans want to reduce government involvement with the poor so government involvement with the poor so people can solve their problems themselves people can solve their problems themselves through markets.through markets.

We can see the effect on government policy We can see the effect on government policy on poverty by examining fluctuations in the on poverty by examining fluctuations in the poverty rate poverty rate over time.over time.

TheThe poverty rate poverty rate is the percentage of is the percentage of Americans who fall below the “poverty Americans who fall below the “poverty threshold.”threshold.”

The Poverty ThresholdThe Poverty Threshold

To establish the “poverty threshold” the US To establish the “poverty threshold” the US Department of Agriculture first determines Department of Agriculture first determines the cost of an economy food budget.the cost of an economy food budget.

The poverty threshold is set at three times The poverty threshold is set at three times that budget.that budget.

It is adjusted for the number of people in the It is adjusted for the number of people in the household, the annual inflation rate, whether household, the annual inflation rate, whether the individual adult householders are younger the individual adult householders are younger than 65 years of age, whether they live in than 65 years of age, whether they live in Hawaii or Alaska (where the cost of living is Hawaii or Alaska (where the cost of living is relatively high) or in the rest of the US.relatively high) or in the rest of the US.

Poverty RatePoverty Rate

The 1930s: The Great The 1930s: The Great DepressionDepression

During the Great Depression (1929-39), During the Great Depression (1929-39), 30% of Americans were unemployed, and 30% of Americans were unemployed, and many of the people who had jobs were many of the people who had jobs were barely able to make ends meet.barely able to make ends meet.

In response to the suffering of the American In response to the suffering of the American people and the large, violent labor strikes of people and the large, violent labor strikes of the era, President Franklin Roosevelt the era, President Franklin Roosevelt introduced such programs as Social introduced such programs as Social Security, Unemployment Insurance, and Aid Security, Unemployment Insurance, and Aid to Families with Dependent Children (FDC).to Families with Dependent Children (FDC).

The Great Depression (Cont.)

For the first time, the federal For the first time, the federal government took responsibility for government took responsibility for providing basic provisions to citizens providing basic provisions to citizens who were unable to do so themselves.who were unable to do so themselves.

Because of Roosevelt’s “New Deal” Because of Roosevelt’s “New Deal” policies, and rapidly increasing policies, and rapidly increasing prosperity in the decades after WWII, prosperity in the decades after WWII, the poverty rate fell dramatically, the poverty rate fell dramatically, reaching 19% in 1964.reaching 19% in 1964.

The 1960s: War on The 1960s: War on PovertyPoverty

In 1964, President Lyndon Johnson In 1964, President Lyndon Johnson declared a “war on Poverty.”declared a “war on Poverty.”

Millions of southern blacks who migrated Millions of southern blacks who migrated to northern and western cities in the 1940s to northern and western cities in the 1940s and 1950s were unable to find jobs.and 1950s were unable to find jobs.

Many African Americans demanded at least Many African Americans demanded at least enough money from the government to enough money from the government to allow them to survive.allow them to survive.

President Johnson soon broadened access President Johnson soon broadened access to AFDC and other welfare programs.to AFDC and other welfare programs.

In 1973 the poverty rate dropped to 11.1%.In 1973 the poverty rate dropped to 11.1%.

The 1980s: “War against the The 1980s: “War against the Poor”Poor”

Reagan explained the tough economic Reagan explained the tough economic times the nation was having was the result times the nation was having was the result of too much government.of too much government.

He argued that cutting government He argued that cutting government services and the taxes that fund those services and the taxes that fund those services supposedly stimulates economic services supposedly stimulates economic growth and reduce relief to the poor.growth and reduce relief to the poor.

Many saw this as a “war against the poor.”Many saw this as a “war against the poor.” Because a large proportion of welfare Because a large proportion of welfare

recipients were African Americans and recipients were African Americans and Hispanics, some analysts believed that Hispanics, some analysts believed that this move was fed by racist sentiment.this move was fed by racist sentiment.

Poverty rates rose.Poverty rates rose.

Myths about the PoorMyths about the Poor

Myth 1: The majority of poor people Myth 1: The majority of poor people are African- or Hispanic-American are African- or Hispanic-American single mothers with children. single mothers with children. In 2006, fully 44% of the poor were non-In 2006, fully 44% of the poor were non-

Hispanic whitesHispanic whites Female-headed families represented Female-headed families represented

53% of the poor, 38% lived in married-53% of the poor, 38% lived in married-couple families.couple families.

Myths about the PoorMyths about the Poor

Myth 2: People are poor because Myth 2: People are poor because they don’t want to work.they don’t want to work. More than 37% of the poor over age 15 More than 37% of the poor over age 15

worked in 2006, nearly 12% full time.worked in 2006, nearly 12% full time. 44% of poor people are under age 18 or 44% of poor people are under age 18 or

over 65. over 65. Many of the poor are unable to work Many of the poor are unable to work

due to health or disability issues. due to health or disability issues.

Myths about the PoorMyths about the Poor

Myth 3: Poor people are trapped in Myth 3: Poor people are trapped in povertypoverty. . Only about 12% of the poor remain poor Only about 12% of the poor remain poor

5 or more years in a row5 or more years in a row

Myths about the PoorMyths about the Poor

Myth 4: Welfare encourages married Myth 4: Welfare encourages married women with children to divorce so women with children to divorce so they can collect welfare, and it they can collect welfare, and it encourages single women on welfare encourages single women on welfare to have more children.to have more children. Women on welfare have a lower birthrate Women on welfare have a lower birthrate

than women in the general population.than women in the general population. Welfare payments are very low and Welfare payments are very low and

recipients suffer severe economic recipients suffer severe economic hardship. hardship.

Myths about the PoorMyths about the Poor

Myth 5: Welfare is a strain on the Myth 5: Welfare is a strain on the federal budget.federal budget. ““Means-tested” welfare programs Means-tested” welfare programs

require recipients to meet an income require recipients to meet an income test to qualify. test to qualify.

Such programs accounted for only 6% Such programs accounted for only 6% percent of the federal budget in 2001. percent of the federal budget in 2001.

Perception of Class Perception of Class InequalityInequality

Research shows that we know we live a class-Research shows that we know we live a class-divided society.divided society.

Why then do we think inequality continues to Why then do we think inequality continues to exist?exist?

Most Americans agree with the statement, Most Americans agree with the statement, “inequality continues because it benefits the “inequality continues because it benefits the rich and powerful.”rich and powerful.”

Most Americans also agree with the Most Americans also agree with the statement, “inequality continues because statement, “inequality continues because ordinary people don’t join together to get rid ordinary people don’t join together to get rid of it.”of it.”

Government’s Role in Government’s Role in Reducing PovertyReducing Poverty

Despite widespread awareness of inequality Despite widespread awareness of inequality and considerable dissatisfaction with it, most and considerable dissatisfaction with it, most Americans are opposed to the government Americans are opposed to the government playing an active role in reducing inequality. playing an active role in reducing inequality.

Most Americans remain individualistic and Most Americans remain individualistic and self-reliant.self-reliant.

On the whole, we persist in the belief that On the whole, we persist in the belief that opportunities for mobility are abundant and opportunities for mobility are abundant and that it is up to the individual to make that it is up to the individual to make something of those opportunities by means of something of those opportunities by means of talent and effort.talent and effort.