Skip to main content
Part of complete coverage from

Inequality threatens the rich

By Frida Ghitis
updated 1:56 PM EST, Fri December 6, 2013
STORY HIGHLIGHTS
  • Frida Ghitis Don't dismiss Obama's speech on inequality as a ploy; it's serious
  • Ghitis: The richest have the biggest share of national income of any time since 1928
  • Conservatives should make ending inequality their cause, she says
  • Ghitis: An unequal society distorts democracy, causes instability, promotes extremism

Editor's note: Frida Ghitis is a world affairs columnist for The Miami Herald and World Politics Review. A former CNN producer and correspondent, she is the author of "The End of Revolution: A Changing World in the Age of Live Television." Follow her on Twitter @FridaGhitis.

(CNN) -- When President Barack Obama proclaimed the fight against income inequality is "the defining challenge of our time," you might have dismissed his words as the effort of a struggling president to revive his political fortunes. But anyone looking at the relentlessly expanding income gap can see that the problem is real -- and it is serious.

The economy is gradually recovering from the Great Recession, but inequality continues to grow. In the first two years of recovery, the net worth of the bottom 93% continued to shrink, while the top 7% grew wealthier. The richest Americans are taking the biggest share of national income of any time since 1928.

Rather than dismissing Obama's call as a political ploy, Republicans in the United States and other conservatives across the developed world, should take up the cause and make it their own. Rising inequality is the proven enemy of stability. And nobody benefits more from stability than the wealthy.

Frida Ghitis
Frida Ghitis

This is their fight, too.

If trends continue, the well-tended sources of wealth of the rich could get trampled by the march of popular frustration.

The signs are already here, in the United States and Europe. A sense that unfairness permeates the system is what fosters extreme views, erodes the middle ground, and makes it increasingly difficult for government to function.

From Occupy Wall Street to the Tea Party, populist politics is creating gridlock and producing a government that cannot address the country's problems. In Europe, the perception of unfairness has fostered extremist parties, such as the neo-fascist Golden Dawn party in Greece, with alarming echoes of the 1930s.

Traditionally, inequality is the kind of issue that receives attention from leftist politicians and is shoved aside by those on the right, who expect free markets to work their magic, improving the lives of those who work hard and, by the judgment of some moral gauge, deserve to be rewarded.

But it turns out that the invisible hand of the market, as economist Adam Smith famously described it, may have developed arthritis in recent years.

Obama is right when he says this is undermining the very definition of what America means. The U.S. was the land of opportunity; the place where you could succeed regardless of where you were born.

In the old days, America was the place where you could be born poor and rise on your own merits. Today, incredibly, researchers say upward economic mobility is easier in Canada and Europe than in the United States.

Obama calls for a raise in minimum wage

This contract, the "American Dream," has meant that the U.S. was not, and still isn't, a land that is fertile for those seeking to sow class warfare. America was never a place where people hated the rich as much as they wanted -- and often succeeded -- in becoming the rich.

But the stratospheric rise of incomes at the top is not just an American problem. And the search for solutions is a global pursuit.

This is a time to debate and innovate; a time to find the causes of this stagnation of the majority and look for solutions.

Unexpectedly, sedate Switzerland has started experimenting with some startling ideas.

When Swiss voters heard that the Chairman of Novartis, a large pharmaceutical corporation, was going to receive some $78 million in severance, they mounted a campaign to ban "golden handshakes." They resoundingly approved strict limits on compensation in a referendum last March.

It's worth noting that CEOs in Switzerland make an average of 148 times what the average workers make. In the U.S., they make 354 times more, according to the AFL-CIO.

The most intriguing of all the ideas will come to the voters next year.

Under a proposal spelled out in a referendum, every Swiss citizen regardless of income would receive a monthly check of $2,800 from the government.

The notion of a guaranteed income is receiving enormous attention around the world. The idea defies traditional notions of government assistance and means-testing. Instead of a giant bureaucracy and complex programs breaking down assistance for food or housing, the government would make sure nobody lives in poverty, and presumably dismantle a host of welfare structures.

In theory, minimum-income programs would reduce the incentive to work. But when a small town in Canada conducted a four-year experiment in minimum income, researchers say poverty disappeared, graduation rates went up, and hospitalization rates went down.

This is just one proposal, and one that focuses more on poverty alleviation than on inequality.

And inequality itself, not just poverty, is a key issue. An unequal society distorts democratic principles. Financial muscle amounts to political muscle. We have seen it in the United States, where campaign donations are reshaping the political landscape.

You might think this is a great argument for the rich to keep the system exactly the way it is. Ironically, however, wealthy businesses use their money for political power, but populist politicians are able to tap into discontent and gum up the works.

The business community hated the government shutdown, but the angry base, particularly on the Republican side, supported politicians who kept the government closed.

The wealthy are more powerful than ever, but they risk losing control of the system if they allow it to continue along its present path.

Self-interest may not be the most admirable reason to fight for justice and a better life for all, but it may just prove persuasive, even if it means heading the call of an embattled president.

Follow @CNNOpinion on Twitter.

Join us at Facebook/CNNOpinion.

The opinions expressed in this commentary are solely those of Frida Ghitis.

ADVERTISEMENT
Part of complete coverage on
updated 4:06 PM EDT, Tue October 21, 2014
Timothy Stanley says Lewinsky is shamelessly playing the victim in her affair with Bill Clinton, humiliating Hillary Clinton again and aiding her critics
updated 10:14 AM EDT, Thu October 23, 2014
Imagine being rescued from modern slavery, only to be charged with a crime, writes John Sutter
updated 12:00 PM EDT, Tue October 21, 2014
Tidal flooding used to be a relatively rare occurrence along the East Coast. Not anymore, write Melanie Fitzpatrick and Erika Spanger-Siegfried.
updated 7:35 AM EDT, Tue October 21, 2014
Carol Costello says activists, writers, politicians have begun discussing their abortions. But will that new approach make a difference on an old battleground?
updated 9:12 AM EDT, Tue October 21, 2014
Sigrid Fry-Revere says the National Organ Transplant Act has caused more Americans to die waiting for an organ than died in both World Wars, Korea, Vietnam, Afghanistan and Iraq
updated 2:51 PM EDT, Tue October 21, 2014
Crystal Wright says racist remarks like those made by black Republican actress Stacey Dash do nothing to get blacks to join the GOP
updated 6:07 PM EDT, Tue October 21, 2014
Mel Robbins says by telling her story, Monica Lewinsky offers a lesson in confronting humiliating mistakes while keeping her head held high
updated 9:29 AM EDT, Mon October 20, 2014
Cornell Belcher says the story of the "tea party wave" in 2010 was bogus; it was an election determined by ebbing Democratic turnout
updated 4:12 PM EDT, Mon October 20, 2014
Les Abend says pilots want protocols, preparation and checklists for all contingencies; at the moment, controlling a deadly disease is out of their comfort zone
updated 11:36 PM EDT, Sun October 19, 2014
David Weinberger says an online controversy that snowballed from a misogynist attack by gamers into a culture war is a preview of the way news is handled in a world of hashtag-fueled scandal
updated 8:23 AM EDT, Mon October 20, 2014
Julian Zelizer says Paul Krugman makes some good points in his defense of President Obama but is premature in calling him one of the most successful presidents.
updated 10:21 PM EDT, Sun October 19, 2014
Conservatives can't bash and slash government and then suddenly act surprised if government isn't there when we need it, writes Sally Kohn
updated 8:05 AM EDT, Wed October 22, 2014
ISIS is looking to take over a good chunk of the Middle East -- if not the entire Muslim world, write Peter Bergen and Emily Schneider.
updated 9:00 AM EDT, Mon October 20, 2014
The world's response to Ebola is its own sort of tragedy, writes John Sutter
updated 4:33 PM EDT, Fri October 17, 2014
Hidden away in Russian orphanages are thousands of children with disabilities who aren't orphans, whose harmful treatment has long been hidden from public view, writes Andrea Mazzarino
updated 1:22 PM EDT, Sat October 18, 2014
When you hear "trick or treat" this year, think "nudge," writes John Bare
updated 12:42 AM EDT, Sat October 18, 2014
The more than 200 kidnapped Nigerian schoolgirls have become pawns in a larger drama, writes Richard Joseph.
updated 9:45 AM EDT, Fri October 17, 2014
Peggy Drexler said Amal Alamuddin was accused of buying into the patriarchy when she changed her name to Clooney. But that was her choice.
updated 4:43 PM EDT, Thu October 16, 2014
Ford Vox says the CDC's Thomas Frieden is a good man with a stellar resume who has shown he lacks the unique talents and vision needed to confront the Ebola crisis
updated 4:58 AM EDT, Sat October 18, 2014
How can such a numerically small force as ISIS take control of vast swathes of Syria and Iraq?
updated 9:42 AM EDT, Fri October 17, 2014
How big a threat do foreign fighters in Syria and Iraq pose to the West? It's a question that has been much on the mind of policymakers and commentators.
updated 8:21 AM EDT, Fri October 17, 2014
More than a quarter-million American women served honorably in the Iraq and Afghanistan wars. Now they are home, we have an obligation to help them transition back to civilian life.
updated 4:27 PM EDT, Thu October 16, 2014
Paul Begala says Rick Scott's deeply weird refusal to begin a debate because rival Charlie Crist had a fan under his podium spells disaster for the Florida governor--delighting Crist
updated 12:07 AM EDT, Thu October 16, 2014
The longer we wait to engage on Ebola, the more limited our options will become, says Marco Rubio.
updated 7:53 AM EDT, Wed October 15, 2014
Democratic candidates who run from President Obama in red states where he is unpopular are making a big mistake, says Donna Brazile
updated 12:29 AM EDT, Thu October 16, 2014
At some 7 billion people, the world can sometimes seem like a crowded place. But if the latest estimates are to be believed, then in less than a century it is going to feel even more so -- about 50% more crowded, says Evan Fraser
updated 12:53 PM EDT, Mon October 20, 2014
Paul Callan says the Ebola situation is pointing up the need for better leadership
updated 6:45 PM EDT, Wed October 15, 2014
Nurses are the unsung heroes of the Ebola outbreak. Yet, there are troubling signs we're failing them, says John Sutter
updated 1:00 PM EDT, Wed October 15, 2014
Dean Obeidallah says it's a mistake to give up a business name you've invested energy in, just because of a new terrorist group
updated 7:01 PM EDT, Wed October 15, 2014
Fear of Ebola is contagious, writes Mel Robbins; but it's time to put the disease in perspective
updated 1:44 PM EDT, Tue October 14, 2014
Oliver Kershaw says that if Big Tobacco is given monopoly of e-cigarette products, public health will suffer.
updated 9:35 AM EDT, Sat October 18, 2014
Stop thinking your job will make you happy.
updated 10:08 PM EDT, Tue October 14, 2014
Ruben Navarrette says it's time to deal with another scandal involving the Secret Service — one that leads directly into the White House.
updated 7:25 AM EDT, Tue October 14, 2014
Americans who choose to fight for militant groups or support them are young and likely to be active in jihadist social media, says Peter Bergen
updated 9:03 AM EDT, Mon October 13, 2014
Stephanie Coontz says 11 years ago only one state allowed same sex marriage. Soon, some 60% of Americans will live where gays can marry. How did attitudes change so quickly?
updated 4:04 PM EDT, Tue October 14, 2014
Legalizing assisted suicide seems acceptable when focusing on individuals. But such laws would put many at risk of immense harm, writes Marilyn Golden.
updated 9:07 AM EDT, Mon October 13, 2014
Julian Zelizer says the issues are huge, but both parties are wrestling with problems that alienate voters
updated 6:50 PM EDT, Mon October 13, 2014
Mel Robbins says the town's school chief was right to cancel the season, but that's just the beginning of what needs to be done
updated 11:43 AM EDT, Sat October 11, 2014
He didn't discover that the world was round, David Perry writes. So what did he do?
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT