Income Gap What is an income gap Why

Income Gap

What is an income gap? • Why does it exist? • What can be done to change it?

• What is the income gap? – The difference in the quality of life between the rich and the poor.

• Why does the income gap exist? – Poor lack the basic skills that would make taking part in the economy possible • Little education= low paying jobs =

Colonialism – Impact of colonialism • the extension of a nation's sovereignty over territory beyond its borders by the establishment of either settler or exploitation colonies in which indigenous populations are directly ruled, displaced, or exterminated • 15% of people own 85% economy • 85% own 15% • What kind of problems does this cause?

Moral Issues • How can any caring society justify vast wealth in the hands of a few while most live in poverty from which they will never escape?

Economic dilemma • Free Market- freedom and rewards • Poor lack basic skills – Little education • Jobs like sweeping or shining shoes • Slums breed disease and encourage crime • Life span is shorter

A Political Problem • Desperate people will take desperate measure • Battles and Rebellions – Argentina, Bolivia, Brazil, Columbia, El Salvador and Guatemala

• Harsh military measures – Human rights and dignity have been violated – Rebels seek economic justice and military protects the wealthy

Solutions • Free Market economy – Providing economic opportunity and stability • Democracy – Outlet for protest and opposition so that policies can be adjusted to reflect the will of the majority of the people • Education – Literate and well educated populations will be need to fill the jobs that will become available in an increasingly complex economy

NAFTA • North American Free Trade Agreement – created by the governments of the United States, Canada, and Mexico – December 17, 1992 – President G. H. W. Bush signed the agreement – President Bill Clinton signed it into law

What is NAFTA? • Free trade agreement • world’s largest free trade area, linking 439 million people and producing $15. 3 trillion in goods and services annually • actually began with President Ronald Regan • Prior to NAFTA, Mexican tariffs on U. S. imports were 250% higher than U. S. tariffs on Mexican imports

NAFTA pros • • • Unemployment was higher Before NAFTA Trade has more than tripled since NAFTA Manufacturing rose 58% from 93 -06 U. S. wages rose 24% Ag exports grew Mexican wages grew – Source: www. ustr. gov

NAFTA cons • Negative impact on Canadian social programs • Did not curb illegal immigration like it was “supposed” to

What is the meaning of this political cartoon?

Income Gap Main Ideas • • • Infrastructure Maquiladora Informal economy Income Gap Why income gap exist? • Impact of Colonialism • Economic dilemma • Political/military problems • What are solutions to problems? • NAFTA pros • NAFTA cons