ASSADI: Charity beneficial, but ultimately falls short in age of income inequality
Column: Dose of Reality
Stories about wealthy families and large corporations donating large sums of money to a specific cause give everyone a warm feeling about our shared humanity.
That money can materially help a considerable amount of people, especially with the astronomical inequality that exists in the U.S. and around the world.
But, charity is a complex form of good-doing. Let us start with the money trail. How do these families, or companies, reach a net worth of billions of dollars?
Many times their accumulation of wealth is through the exploitation of their workers. Their model for optimization may include having lower wages, and therefore more money for their shareholders.
In the past few decades, worker productivity has steadily increased, along with the creation of wealth by those workers, yet wages have stayed stagnant.
Unless the company is in the small minority that pays its workers a living wage, the societal effect of its charity becomes obsolete. They have the power to deliver wealth to more people in a sustainable fashion by raising their wages, but it costs less money for them to contribute to charities and receive positive news coverage.
Their immense wealth may be as a result of tax evasion, which is a statistically significant problem that contributes not only to our national deficit, but also leads to the cut in services offered to the majority of Americans.
The New York Times found that the richest 400 people in the U.S. pay a much lower tax rate on their income than the majority of Americans. Even Warren Buffet claimed that he paid a lower tax rate than his secretary, thanks to loopholes for the wealthy. The extremely wealthy find loopholes, and everyone else pays the difference.
Loopholes are not the only means of hoarding wealth. There are many more legal, and less infamous, methods of securing one’s spot in the wealthiest 400 people in this country. One would be to support politicians who insist on cutting taxes.
But if you are like our current President Donald J. Trump, if you want something done right, you do it yourself. Trump’s tax cuts leave approximately $1 trillion unaccounted for, and the tax cuts benefit the extremely wealthy the most.
The tax plan “slashed tax rates for people making more than $1 million and for pass-through companies disproportionately used by the wealthy, and it rolled back the estate tax on wealthy heirs and heiresses," according to Vox.
The question typically asked by, but never asked to, Republicans and conservatives: How will this plan be paid for? Historically, and as espoused by Republicans today, the services that would be cut in order to lessen the blow of large tax cuts on the extremely wealthy would be food stamps, Medicare and Social Security.
This means that even if the middle class saves a small portion of their taxes, entitlements that they have paid into for their whole lives can be taken away from them. Middle-class Americans will end up paying into programs that they will never benefit from. We will never see that money again. That money will end up in the banks of billionaires, and on the yachts of the extremely wealthy.
Recently, there is growing consciousness and concern over income inequality in the U.S., and this plan exacerbates it. By progressively lowering the effective tax rate on the ultra-wealthy as you go up the income bracket, any minuscule benefit felt by the middle class can be crushed by the immense power the upper class holds.
The circumstances of the rest of America will either end in minimally lower their taxes but steal any benefits that they are entitled to, or the worsening effect of income inequality.
Although some make the argument that the ultra-wealthy are some job-creating geniuses that should be protected by society, they seem to have a fairly negative effect. They have a ridiculous amount of wealth, and the power that comes with that wealth, yet they have no inherent responsibility to benefit society.
So why worship and protect them? The only entity that is entitled to serving the American people is their government, and programs such as Medicare and Social Security are being gutted to protect the wealthy few.
Let us not forget who writes these policies: the wealthy, or politicians funded by the wealthy, due to an amendment in our legislature called “Citizens United.” By repealing this legislation, there can be an end to the legal bribing of politicians by large corporations.
Even though this feels like an endless cycle of hopelessness about how to fix wealth inequality, there is a path to essentially fix it: repeal Citizens United, a solution touted by Democratic presidential candidates Sen. Bernie Sanders (D-Vt.) and Sen. Elizabeth Warren (D-Mass.).
We should not let the charity work of a few wealthy individuals or companies cloud our vision about their societal effect behind the closed doors of Washington, D.C.
Yara Assadi is a School of Arts and Sciences sophomore majoring in public health. Her column, “Dose of Reality,” typically runs on alternate Thursdays.
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