Vincent Yip
Professor Cambridge
English 101
10/12/13
We Are Divided
Why is there a growing gap between the rich and the poor? Why is the economy of much of the world programed this way? For the past seven years after the recession that hit the world in late 2008 there has been a change in focus, a focus on the growing gap between the rich and the poor. This issue is raised frequently around the world even in well developed nations like Singapore. This topic of economic inequality is reported on the news, debated about in governments, and discussed by the people. With a country like Singapore, an economic powerhouse of the world, is their economy sustainable? With such a improper distribution of wealth it can be possible that Singapore’s economy may not be stable after all.
At the start of college, I had a conversation with a gentlemen that I met on the subway at Grand street. He accidentally bumped into me and we started to talk, mainly about the economy. He told me that there was a divide in the economic world, that the wealthy are pocketing more money while the poor are making less money. He told me his reasoning for this that the government is allowing this economic divide to happen and that this divide is what makes the people unhappy and leads to economic instability.
The GINI coefficient is used to show the discrepancy between the rich and the poor. The lower the coefficient is to zero the smaller the gap between the two extremes. The closer the coefficient is to one the greater the gap. The Global Post provides a map that shows the GINI levels of all countries around the world. According to the Global Post map the Singapore have a Gini level of .414 which is comparable to the the United States with a Gini index of .45. The Gini index does not cover the whole story. Although Singapore have a similar Gini Index to the United States the income per capita for Singapore is over $61000 dollars while in the US is just over $50000 according to The World CIA Factbook. What this means is that there can be a very economically powerful country and yet there can be uneven distribution of money. Just analyzing the Gini index or the income per capita individually can not give an exact idea of how sustainable the country’s economy is. We must look at is both data. Although Singapore have a large Gini index the average Singaporean is making more money. A sustainable economy relies on a strong economy and the people making enough to have a living.
In Singapore there is no poverty line even though there is an improper distribution of wealth. In a comparable basis with the United States a Singaporean in poverty is better off than a citizen in the US. For Singaporeans in the bottom 11 to 20 percentile the average monthly income of S$3100 or nearly $2500 in US currency which adds up to $30000 annually compared with a US citizen, the annual income in the bottom 11 to 20 percentile is just $21000. According to the article Are Singapore's poor better off? By Rebecca Lim she states that “being poor in Singapore, people were still ''less badly off'' than the poor in other countries, including the US.” From an interview with Singapore's Prime Minister Lee Hsien Loong. What ends up happening is that the Singaporean government subsidizes those that are poor. The Public Assistance Scheme and community assistance aid the unemployed for three months so that they can have enough to buy all the necessities that they need. Singapore’s government also implemented the rent and utility scheme and the health care subsidies which also give citizens a place to live in and health care even after being unemployed. In Singapore it seems in order to have a stable economy the government will intervene and help its people that are lagging behind the rest economically.
The economy has an affect on everyone both on the rich and on the poor. Evidence show that there is a wide gap between the well off and those that are not. So what is causing this? Some say it is because it not enough government regulation and intervention that is allowing corporations to make all the money. However in Singapore they have the second most capitalistic economy in the world and yet the country does not have a poverty line. Although Singapore is not perfect it, with its high Gini index and still having poverty, Singapore may have some answers to a sustainable economy.
