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What are some realistic and creative ways to reduce wealth inequality?

I am a a third year student completing a degree in Social Work in Hamilton, New Zealand. I am currently doing a paper on Social and Community Development where I have to consider a topic of interest and then form a plan based on a theoretical perspective to eliminate or reduce a social issue.

My chosen topic is: Then impact of wealth inequality on social cohesion within New Zealand.

I would love to hear some creative and realistic thoughts around reducing this social issue which is a rapidly increasing, world wide issue. If anyone is well versed around topics such as this, stating your political ideology/perspective/basis of your ideas would be a great help so that I am able to further research the good idea's!

The primary focus will be on reducing wealth inequality as by doing this, social cohesion will increase. Despite this, I do hope to develop a small scale plan to increase social cohesion as well to strengthen the assignment.

Thanks heaps in advance :)


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    May 21 2013: how do we know that inequality is a social issue? it is alarming how few and how weak are the reasonings put forward in favor of inequality being a problem. most people just think it is. some felt the need to go a little more deep, and they dug up some quasi-statistics that not only stink, but does not prove the point either. yet, we just wave a hand, and continue with the assumption that inequality is not only a problem, but one of the biggest, if not the biggest problem of our time. we go so far that many people analyze its roots in the human psyche in detail, and looking for a "solution".

    so please tell me, if we have a hundred men, all having one sack of potato, or we have a hundred men, 99 having one sack of potato, and one having a thousand sacks of potato, how is the latter any worse than the former?

    usual replies:
    1, because it grants him power ... how exactly?
    2, because it makes people envious ... sure, so work on that instead, because it is wrong.
    3, some research indicates life quality dropping ... it is hard to take such studies seriously, but okay, how? why don't we work on the mechanism?
    4, unfair ... how exactly? what if the rich person does not do anything immoral, just makes good decisions? how is success unfair?

    the best way to increase social cohesion is peer-to-peer business. if my fellow man is my business partner, his success is my success. his ideas make my life better through better and cheaper goods. his wellbeing is important to me, because he provides some good for me. division of labor makes us a huge cooperative collective in which everyone can find his place, and everyone can contribute and improve.
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      May 21 2013: I suppose what I would argue is that they should all be given equal opportunity.
      It greatly depends how this one man gained his "potatoes".
      "it's who you know not what you know"
      Considering your situation very rarely happens. That not all are (in-fact) given equal opportunity.
      That one man who owns the potatoes would have had an advantage over all the others, which the others might not have been able to gain through sheer hard work.
      However it is worth mentioning that you do raise an interesting point about how we compare scenarios. :-)
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        May 21 2013: the single greatest counter to this who vs what issue is the free market. if people are making decisions about their own property and time, and the stake is their own wellbeing, they tend to maximize efficiency. efficiency does not allow favoring friends. as an entrepreneur, you want the best employees, the best contractors and the best products from the market. an entrepreneur favoring his friends will lose in the competition.

        the man who owns the potatoes does not have advantage, as he does not have anything else. he is the potato farmer or farm owner, which means he needs to trade potatoes with people having chickens, computers, cars, etc. or time. people having nothing but time are called employees. and their time (multiplied by knowledge) is just as valuable on the market as cars, potatoes or anything.
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          May 21 2013: The farmer who has the most potatoes doesn't have an advantage?
          He can live longer on the potatoes he got alone, and increase his material well-being. Considering he can eat more potatoes, while the others may have to ration their potatoes.
          Consider this :
          The man who gained the most potatoes worked hard, yet he just got a good harvest.
          While all his friends who worked equally hard, didn't get a good harvest.
          Is that fair?
          Interesting how my story has no mention of Creativity or intelligence...
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        May 21 2013: how come then, that not the potato farmers, but for example software developers have higher living standards? you certainly can't eat a software, they should die in hunger. but it is not what happens. what happens is that people receive according to their contribution. if you help more people to be a little more satisfied, you get more in return. this is how a modern market economy works.

        good harvests and other natural phenomena are outside of the realm of fairness. one man gets sick, another does not. one man is smart, the other is not. one man is strong, the other is not. one man has an idea, the other does not. we can't level the playfield. all we can do is to gain knowledge and technology and build capital to combat the hardships nature puts on us. technology, knowledge and capital grows in freedom.
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          May 21 2013: Now that's a different story. A completely different story.
          Regarding software, I do agree with you (in terms of "eating software"). However there software in turn may be "lucky". However I don't know enough about computer sciences to comment, or coding for that matter.

          "other natural phenomena are outside of the realm of fairness"
          From that logic I could claim all the economics was unfair. Considering there may be genes which make you more prone to work harder, or if intelligent was mostly genetic. And intelligence is required to do well in business.
          Then you could argue that the whole world we have created is unfair.

          Hasn't your first point now become slightly redundant? :P
          Considering you yourself have said :
          "how is success unfair?"
          Then you go onto to say :
          "one man gets sick, another does not. one man is smart, the other is not. one man is strong, the other is not. one man has an idea, the other does not. we can't level the playfield."
          Isn't this a inconsistency in your own logic?
          Or have I just misunderstood?

          So I ask you what is the purpose of all this "technology, knowledge and capital"?
          To be happy? I think I remember discussing this matter with you before, yet material gain doesn't guarantee happiness.
          Watch "Dan Gilbert: The surprising science of happiness" :

          "if you help more people to be a little more satisfied, you get more in return."
          So basically reciprocity? http://en.wikipedia.org/wiki/Reciprocity_(social_psychology)
          I view we should help people, not out of self-interest, because it is the right thing to do.

          On a side note you may enjoy watching "Michael Norton: How to buy happiness" :
          On the matter of how spending money on other people, and charities, can increase happiness more than spending it on yourself.
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        May 21 2013: here is that part: "if intelligent was mostly genetic. And intelligence is required to do well in business.
        Then you could argue that the whole world we have created is unfair."

        we did not create genes. genes are natural. god given, if you will. so we did not create this unfairness. we got this, and have to live with it. we have to make the maximum out of it.

        i don't buy any of these studies. c'mon, money does not make you happy, get real. but even if it was true, it still would not make sense to redistribute it. worthless things are worthless even if redistributed.
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          May 21 2013: However we don't do a great job of making it fairer?
          Do we?
          So now you have admitted that some success isn't fair (to me anyway).
          "money does not make you happy"
          What do you mean by this?
          That an increase in material gain (the things money can buy) doesn't make you happy?
          "it still would not make sense to redistribute it"
          Yes it would. To make other people happy. :-)
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        May 21 2013: i don't think we have to make it fairer. i don't know if it is better or not, i don't even know if we can measure if it is. but even if it would be better, i think we should focus on making life better in general and not fairer.
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          May 21 2013: Ah!
          So now you admit the economic system isn't fair.
          Then why did you say " how is success unfair?"
          "i think we should focus on making life better in general and not fairer."
          By making life fairer you can make life better.
          And better for whom?
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        May 21 2013: there is unfairness, but it does not come from inequality. it comes from nature. if nature would not give us any unfairness, and we had inequality, it would be perfectly fair. it would be a result of work.

        in a real world, inequality comes from two sources, the randomness of nature is compounded with work and effort.

        that said, it does not logically follow that we need to counter natural unfairness. it is a choice, and it needs further consideration if it is a good idea or not. but it is certainly a bad idea to force that decision on others against their will.
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          May 21 2013: "it does not logically follow that we need to counter natural unfairness"
          I believe we should. For it the right thing to do.
          Considering many have the potential to do amazingly under the right circumstances.
          And we (humans) can shape these circumstances to increase maximal good. Which thus encourages fairness.

          So are you basically saying that because nature gives us unfairness and inequality we should embrace it?
          This seems extremely cruel to me.
          To me it is like saying that if someone is born with a disability, then we should let that person fend for themselves, and slowly die. Rather than trying to find the cure for their troubles. All due to it "not logically follow that we need to counter natural unfairness".

          " it is certainly a bad idea to force that decision on others against their will"
          I agree. However you could argue it would be a "bad idea" to (ironically) force democracy on people. Is this a "bad idea"? (This point is quite hard to put into words...)

          Regards, :D
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          May 22 2013: I really wish that you could explain that to our president.
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      May 21 2013: Hmm, You have some very good points! I would have to argue that human's tend to go too far with control when it is granted.
      I dare say that any human having too much of one thing while others struggle to manage the limits they have been given is a very unbalanced situation. Along with this, the more quantity one has, the more they tend to want. The less a human has, their behavior is more appreciative and realistic towards their situation. So let's talk a little about control and consumption.
      Reduce the amount of control and consumption one is given, and your wealth of inequality will decrease. People might be a little bit level headed than being blinded by their ego perception.
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        May 21 2013: "is a very unbalanced situatio"

        now you have introduced a new term "balanced". without definition, this is too vague.

        " the more quantity one has, the more they tend to want"

        i disagree. or rather, i agree only in additional terms. if i don't have bread, i want a bread badly. if i have one bread, i probably still want another bread, but not as badly. this is nothing but the law of diminishing returns. we humans tend to always want more, but i refuse to see that as a failure, only in extreme situations. what we need is to put a price tag on everything. if you give something for free, people will want infinite amount of it. if you assign a correct price, the demand will fall to the appropriate level.
        • May 21 2013: is it true to say they would want an infinite amount of of it? You can scale the traits of human nature up to its vanishing point but I wonder if the conditions were correct if it wouldn't stabilise somewhere more acceptable. Its not the having of the potatoes thats the issue as much as the hoarding of them.

          Apple for example are apparently sitting on £95billion in cash reserves. Good luck to them, they are an incredibly creative company in terms of their ability to make products people want and their ability to make them want them. And they have done that where I have not, so why should I demand to spend their money?

          But that money isn't working very hard, so rather than take it off them cant we take a portion of the interest and feed it to the government to provide health care or social housing or education? In a UK current account thats around 3billion a year. It would make not one stroke of difference to the Apples or whoever to take 1% and give the other 2% to put to good use – and thats assuming basic investment levels. The same goes for UHNW individuals. They should be allowed to earn their money, as much as they can, and continue to do good work employing others. But to absorb more and more of it just by virtue of having it seems perverse to me. It could make a huge and real difference.
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        May 21 2013: it is a level of genius to put forward an argument that is false, but if it would be true, it still would be false.

        i clearly was talking about a free market, and freely cooperating individuals. lobbyists and politicians are outside of what i called "peer-to-peer" business. they are oppressive forces.

        but even if we accept the existence of politicians and oppression as part of a free market, we can still observe an impressive progress in the living standards of the poorest men. in 1800, average(!) income in the US was like 1500-2000 dollars per year. today, below 11000 or so you are on foodstamps. and this does not include free use of roads and police and other state granted services. it is very hard to say that even the poorest US citizens "do not have potato".
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        May 21 2013: if we are looking for a solution, it automatically means that the current situation is not satisfactory. so nonexistence is not really a counterargument to a proposed solution, is it? so far, formal logic.

        continue with basic math and common sense. if at a certain time, the average is 1500, how can you redistribute it to get an average 50000. please note the use of words here. i said average, and not common or median. that is, the total divided by the number of people.

        a free market is very much realistic. we don't even need to go to exotic places. 1800, united states. taxes were in the few percent range. tariffs were minimal. regulations were negligible compared to today's levels. and the annual growth was a stable 4%. entire populations were lifted from poverty. the science is solid: welfare and economic freedom goes hand in hand. and nothing else worked so far.
        • May 27 2013: It is true the average cannot be changed by redistribution. However, the median can be changed. if 99 people have 1 dollar and 1 has 9901 dollars the median is 1 dollar and the average is 100 dollars. If 100 people share 10000 dollars equally the median and average is 100.

          The problem is the word fair. What is fair? How do you take the 9801 from one person fairly?
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        May 21 2013: yeah, and the nonexistence of women's suffrage in 1900 is a proof that it never worked ... jeez. heard of a term "progress"?

        my numbers does not apply? those were actual real data.

        please tell me how statement A, "taxes were a few percent" and statement B, "taxes existed" contradict each other? formal logic? no?

        what i support is rather irrelevant. what is relevant is my actual point. it is either true or false.
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        May 21 2013: you moved the goalpost midgame, which is a known fallacy, and a dishonest method in a debate.

        what difference does it make from what? fyi it is from gapminder.org

        i don't have to show that the free market exists. my point is that it is good, therefore we should implement it. if it existed, we would not have to implement it, would we? duh.
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        May 21 2013: "If you claim something would be good you need evidence that it has been successful."

        before i make something, i need to try it? well, let me just say, it does not take a degree in engineering to see why this does not work.

        i understand the free market. i have studied it. i have read 12 books on it, and listened to over 50 ours of audio lectures. and it pretty much covered all the falsehoods you put on the table about it. arguing them is less entertaining, more like routine. an entire bookstore could be filled with the works that explain how regulations and the "welfare state" cause the problems you list.
      • May 21 2013: So whats your solution?.. communism? you choose to focus your tunnel vision on those rich people who do bad. You are aware that the rate of moral/social deviance is only like 5% in every society so you think rich people somehow defy that fact and are demons. Dont you think there are a lot of good rich people who use their wealth and influence to do good? how many American billionaires are philanthropists? Wasnt the American founding fathers all rich aristocrats who had everything to loose by signing the Declaration of Independence? why did they do that? wasnt it rich European Aristocrats who ultimately ended the strangle hold the church had in Europe and brought about the Enlightenment under the threat of death?.. tell me where is the common mans role in capitalism? There are many smug Liberals whos oppose capitalism ideologically but still have Chase Bank accounts and wear designer clothes from companies whos products are made in sweat shops. what ever happened to voting with your money and not giving money to companies whos policies you disagree with.. walmarts only rich because of its consumer base period.
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        May 21 2013: "Your potato model shows you do not understand the complexities of an economy."

        it can also show that you don't understand the argument.
      • May 21 2013: "It is the power that wealth provides that leads to wealth inequality as the wealthy can use that wealth to buy out all competition, control resources, control government, create laws and even own armies to stop any rebellion that might threaten their wealth."--- if thats not Marxist rhetoric than i dont know what is?

        "Yes we have improved the lives of poor people but the system that does that is a system of taxes, minimum wages and social welfare programs designed to reduce wealth disparity so your argument supports the reduction of wealth disparity!"---- Thats not only socialist anti-capitalist think it also is completely false. Free-markets work when they are free, taxation deincentivizes workers and bussineses alike. The competition and incentive provides by free enterprise systems is what continually increase humanities standard of living. Whos going to put all the time and effort engineering new drugs and technologies if there wasnt a pay off and a competitor who motivates drive to innovate faster... The facts are there every country who has established a certain level of legitimacy in government and economics has a standard of living and average anual income rate that is perpetually increasing.
      • May 21 2013: What do you mean by regulations? Obviously markets need to be policed to an extent and need minor top down implementation but that entirely different than subsidies and fiats. You probably have not a single idea of economics do you? First of all, arguing the side of justice, its your regulations that make American style economics unfair. Your regulators tax and regulate which stifles growth of small business while simaltaneously implementing huge corporate welfare policies benifitng large enterprises. Oh and if you knew the politics behind subsidies and corporate welfare you would see that the legislators pass these laws under the pretense of helping the average joe because our genious regulators believe that companies like Wal-mart not only employ many Americans but also provide goods and servces so they shouldnt pay their fair share.. How do you expect somebody to strive for success as an entrepaneur when big companies have unfair legal advantages and are getting taxed 25% of their profits while Wal-marts and jewels are getting taxed like 5%. ALso whos going to be motivated to do something with their lives if they can just collect welfare checks, section 8, and food stamps and not have to do anything. Dont you think the welfare state and the corporate welfare state are like government being a bad parent and enabling their childs bad behavior?
      • May 21 2013: you think im enforcing your point but thats because you have not a clue about encomics, period. You probably couldnt give me one example of a government subsidy and how its used theoretically to protect
        a market and its consumer? You cant because you are politically, legally, and economically illiterate. You cant even grasp my point without distorting it. My point; Legislation passed under the pretense of helping
        ends up hurting because the very policies have loop holes and stipulations that favor big enterprises.. for example the housing market between 78 and 02. Your a big environmental guy and i bet you agree with the governments percieved attempts to maintain agriculture and create green jobs while totally ignoring who is really benefiting..
      • May 21 2013: You have selective perception or something because your not comprehending. subsidies are not FREE market but actually the opposite and yes although some subsidies are lobbyed for on a complete financial basis many if not most are lobbyed for on an ideological basis. Governments in many cases intervene with the best intention but it backfires so Get Government out of the way and let the markets be free of restraint.. thats what im saying.. Government shouldnt have a finger on the dial hence keep markets free.. policing a markets a differant story, two different things. Supply and demand should dictate the markets and not government subsidies which create artificial variables. Why do you think im arguing against free markets when im arguing clearly against government interventionism?
      • May 21 2013: Actually the market can and does regulate itself thats the very argument for capitalism as put by Smith. I think markets should be 95% free with 5% regulation and that regulation pertains to trust and monopolies as you put.
      • May 21 2013: wow.. i thought we were getting on the same page, guess not. It was regulation that cause the economic collape.. if banks and mortgage companies didnt get leverage from government authorized fiats the situation would never have existed to manifest the vulture capitalism which ensued. 52%of all mortgages given out between 78 and 02 where under government subsidation. what that means is those lenders would never have loaned the money had government not backed these lenders with fake assetts and derivatives. The banking system itself is centralized by fiats and had a lot to do with the collapse and thats not the free market thats government protection and legislative authority. China is a perfect example of governmentism. Its the chinese government which works with corporations to legally bind its people into working in sweat shops.

        Companies can self regulate if left alone its when government steps in when it create conditions which are unnatural to the system and are manipulated. Does coca-cola only follow safety guidelines because the law forces it to or do you think its in their best interest to satisfy its consumer so therefore not poisoning them. The same principle is in effect everywhere unless government steps in a protects and manipulates the organic system which is capitalism.
      • May 21 2013: Banks and mortgage companies are corporation but are backed up by FIATS and therefore have special authorities and privileges given by government. First of all banks are so far away from a free-market enterprise in many ways for many reasons i dont feel is necessary to get into however with mortgage companies, banks where protected and given authority by government to do many deeds very contradictery to your typical free-market model. If banks and mortgage companies where left to be just corporations and not government arms than yes they would self regulate like other companies.
      • May 22 2013: corporations may want government to do their bidding but unless the government actually does than no evil happens. Lobbying would end too if the governments just stepped to the side, but they dont, and like i said before governments call upon corporations to do their bidding as well. Having a law to protect society from corporate wrongdoings is totally different than a government determining the factors that make up a market. so like i said governments should police a market but not have their butts in the way that markets operates unless its interfering with the rights of another person or enterprise.
      • May 22 2013: i think i agree with you totally. Lobbying is a huge problem and definitely undermines the principle of democracy. Governments have a monopoly on force and true constitutionalism and Libertarianism is about limiting the way government utilizes that force. The danger is that the government deploys that force under the pretense of doing good and its absolutely doing harm. And like you pointed out when money making enterprises are in allegiance with the consolidator of force then there is real trouble.

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