In Oxfam report headlined on January 20, 2014, “Rigged rules mean economic growth increasingly “winner takes all” for rich elites all over world,” it said, “Wealth of half the world’s population now the same as that of tiny elite” “Wealthy elites have co-opted political power to rig the rules of the economic game, undermining democracy and creating a world where the 85 richest people own the wealth of half of the world’s population, worldwide development organization Oxfam warns in a report published…”
Nowhere in a global economy is the above more evident than in Nigeria where political power is sought simply for selfishness. The brewing political fights at both state and national levels are not for the common man; the principals are not warring to uplift the masses. They don’t even tout any agenda or policies that would close the widening income inequality. They are, indeed, juxtaposing for who has more power to wield that will consequently exploit the masses most. These individuals or political opportunists as I would call them, who struggle for power at all levels, are pretty preoccupied with their vestigial tales of their antecedents primarily to flummox and hoodwink the electorate. That begs the question, how would those in the throes of economic doom and perennial penury not muster courage to demand for accountability? How the masses could not held the political opportunists accountable and responsible for their actions is still subject for further analysis.
However, in a bifurcated society strongly anchored in a stagnant economic upward mobility, the gap between the haves and have-nots is increasingly widening with no end in sight. It could be fairly concluded that there is no middle-class. It is either you are wealthy or poor. For you to be wealthy, for the most part, you must be in politics or associated with the politicians. The absence of middle-class may be due to low wages, lack of consistent salary payments in both public and private sectors, non-payment of pensions, and utter deficiency in savings.
Also, the issue of staggering unemployment creates income inequality. Most people, especially young people in Nigeria are chronically unemployed, meaning that they have been out of work or they have never found a job after graduation for several years. Still, some are grossly under-employed, meaning that they are working in an environment that requires less skills and are severely underpaid. Thus, the dearth of employment for the masses, particularly young people who have acquired the necessary skills and capacity to perform the job, exacerbate income inequality.
Besides facing chronic unemployment, as well as severe underemployment, Nigerian employees are facing a phenomenon in Nigeria that has dangerously become the norm. This norm has permeated the society is shamelessly practiced in both private and public sectors. This is what I would call forced labor or modernized slave labor, which does not require a policy or security guards to force people to work just like in the labor camps in the past. But the modern day forced labor seems to achieve precisely what was achieved in the labor camps, free labor. In this modernized situation, people voluntarily go to work and work for several months without paychecks. The expectations of receiving arrears in a foreseeable future and the apparent lack of alternatives, forced the employees to stay with employers that owe them several months of salary. This could be likened to the modern day slavery, as well.
Similarly, this is a disguised slavery called employment—a situation where employers owe their employees several months without payment. The employees would not have any recourse; they are caught in a catch-22—a situation where they cannot leave their present employer for fear of not getting another job and they fret over suing their employers for job security. The fear is understandable in a society with an abysmal job outlook. These employees are hamstrung as they are caught between a rock and hard place—hopelessness. Unfortunately, another cause of widening income inequality is lack of pension payment in Nigeria. In the United States, the federal and state governments, as well as municipalities, take great measures to ensure that retirees are not left in the cold. Secondly, spending resulting from the pension benefits significantly impacts the economy.
The pensioners use their benefits to pay for goods and services. The expenditures from the retirees help sustain employment in various sectors. A recent report by the National Institute on Retirement Security, “Pensionomics 2016: Measuring the Economic Impact of Defined Benefit Pension Expenditures,” found that that the economic gains associated with expenditures of pensioners based on their pension benefit are sizable with “large multiplier effects.” The report found that “the retiree spending of pension benefits in 2014 generated $1.2 trillion in total economic output, supporting some 7.1 million jobs across the U.S.” On the multiplier effects, the report found, “Each dollar paid out in pension benefits supported $2.21 in total economic output nationally.” Measuring the “economic impact” and “economic effects” of all pension benefits nationally, the report further said, “Each taxpayer dollar contributed to state and local pensions supported $9.19 in total output nationally. This represents the financial value of long- term investment returns and the shared funding responsibility by employers and employees.”
Without a doubt, it is the interest of the government to promote a condition where retirees live out their lives in dignity and not in poverty. Thus, there are other government programs that assist retirees who meet certain income threshold. So, besides the traditional pension benefits, retirees in America enjoy the social safety net, which is a collection of benefits and services provided by the federal, state, other institutions. The intent of the social safety net is to prevent individuals from falling below a certain poverty level.
Also, some retirees may receive Social Security and Medicare benefits in addition to their pension benefits. While Social Security is a government program that provides monetary benefit to individuals with no income or certain level of income, Medicare, which is generally for those who are 65 years or older, is a federal government health insurance program. Medicaid is yet another joint federal and state health program that helps low-income people for the payment of custodial care and long-term medical care expenses.
In summary, in the United States, people receive various benefits from the social programs such as unemployment benefits, Medicare, Medicaid, Social Security, Women, Infant & Children (WIC) Program, and Food Stamps to help alleviate some of the pains of unemployment and poverty. In addition to all these benefits, government ensures that employers adhere to minimum wage requirements.
In a stagnant torpid economy, coupled with brazen corruption and entrenched selfish politicians, the widening of income inequality will go unabated.