In The Price of Inequality, Noble Prize-winning economist Joseph Stiglitz points out that, at $90 billion, the combined wealth of the six Walton family heirs to the Wal-Mart fortune is equivalent to that of the entire bottom 30 percent of Americans. Stiglitz argues that even the rich will be hurt when we reach the point "when inequality spirals into economic dysfunction for the whole society."
In this presidential and congressional election year, we must all begin to take action on our stake in this country's future. For our children's future, America needs to get better by reengineering our shared values and implementing a united ethical purpose.
To progress, we need to pay attention to the worldwide grassroots leadership movements and locally grow skilled grassroots leaders who are ready, willing and able to help others make a difference in the lives of all Americans.
The squeeze on middle America promises to be long lasting without change.
There's little doubt that the American middle class—the 40% of households with annual incomes between $50,000 and $140,000 a year—is in distress. Even before the recession, incomes of American middle-class families weren't keeping up with inflation, especially with the rising costs of what are considered the essential ingredients of middle-class life—college education, health care and housing. In 2009, the income of the median family, the one smack in the middle of the middle, was lower, adjusted for inflation, than in 1998, the Census Bureau says.
Economist Edward Wolff of New York University estimates that the net worth—household assets minus debts—of the middle fifth of American households grew by 2.4% a year between 2001 and 2007 and plunged by 26.2% in the following two years.
A researcher for Procter & Gamble Co. (P&G), recently asked a 40-year-old single mother to describe her family, her favorite pastimes and how she feels about money. This low-income consumer is part of a long-term P&G study tracking several consumers over time to gauge how sentiment is evolving as the economic slowdown wears on.
Despite waitressing to supplement her 20-year career as a support specialist at a cable company, the woman said that her finances are strained as utility bills, gas prices and the expenses of her two daughters keep growing. Her scrupulous budgeting of household expenses hasn't alleviated the pinch. "Instead of getting in a better situation, I feel like I'm getting in a worse situation," she said
To monitor the evolving American consumer market, P&G executives study the Gini index, a widely accepted measure of income inequality that ranges from zero, when everyone earns the same amount, to one, when all income goes to only one person. In 2009, the most recent calculation available, the Gini coefficient totaled 0.468, a 20% rise in income disparity over the past 40 years, according to the U.S. Census Bureau.
How does the economy increase stress in American lives?
Bellevue University released these survey results on stressed out Americans:
• 55% of Americans report experiencing stress in their lives.
• Income loss and increased amounts of personal debt are the biggest stressors, with 33% of Americans citing these two factors as causing them the most stress.
• Job related stress comes in second with 18% of working adults citing work as the biggest stressor.
• 9% of adults say working in a job that doesn’t fit their skills or aspirations stresses them out the most.
• 9% say they are stressed due to the increased workload caused by staff reductions.
How do we, as leaders, develop ourselves, our communities and our world to reinstate the American Dream?
Making the dream we have for our childrens' future become a reality is up to each one of us to lead the way forward. Here in America, we have always known that positive change is up to us and not dependent upon governmental actions.
By engaging in conversations that pull people toward becoming comfortable with the language of personal responsibility and commitment is the first step forward. These coaching conversations help us to develop workable plans and the leadership skills required to clarify our agreed-to values and begin to build our joint reputation.
Joseph E. Stiglitz: The Price of Inequality: How Today's Divided Society Endangers Our Future
John G. Agno: Can't Get Enough Leadership: Self Coaching Secrets
Boris Groysberg: Talk, Inc.: How Trusted Leaders Use Conversation to Power their Organizations
Mary C. Gentile: Giving Voice to Values: How to Speak Your Mind When You Know What's Right