Rising income inequality in America isn't breaking news, but the scope and factors driving it are beyond the breadth of the public consciousness. A study put together by Michael Norton of Harvard Business School and Dan Ariely of Duke University casts light on the issue.
Perceptions on the Distribution of Wealth
Americans think that wealth distribution in the country is far more equitable than it really is, and, when asked, would prefer that it be even more equitable than their initial guess. As far as issues grabbing headlines this campaign season, both parties’ rhetoric has focused on the rise of the uber rich, falling wages, the growth of government, outsourcing, immigration, and absolutely anything but the decline of unions as a factor in distribution of wealth.
A 2010 study from Harvard and a new report by the Economic Policy Institute indicate that the decline in union membership is responsible for as much as 33% of the growth in income inequality among working men. Between 1973 and 2007, private sector union membership among men (women were never as heavily unionized) fell from 34% to 8% (16% to 8% for women).
Dwindling enrollment does not only entail a loss of wages for union workers but for workers across the board. When labor is strong, management raises wages to dissuade unionization. When labor is weak, management threatens unionizing workers with termination, as some have charged Walmart does in its stores and warehouses. Unions with fewer members also mean labor without a voice in Washington and the loss of a political welterweight that used to go toe-to-toe with the barons and magnates who, left on their own, would squeeze the middle class out of existence.
graph via Mother Jones