One of the main precepts of capitalism is to promote the interest of only one’s self, and to accumulate as much wealth as possible in order to raise one’s standard of living. The theory of “supply-side” economics has helped to further these ideals and to create an unequal distribution of wealth within the United States. Supply-side economics, also known as the “trickle-down theory”, is based on the assumption that a small percent of the population actually controls or possesses a majority of the wealth and that through the free-market system, each member of the economic community has an opportunity to obtain some of the wealth as well. This system, in theory, would reward the most resourceful and ambitious with the opportunity to accumulate as much of the available wealth as possible.
This was the basic economic policy of the Reagan and Bush (Sr.) administrations through the 1980s and into the early 1990s. ““Supply-side economics” that would make the rich richer in the hope that some of it would trickle down to the poorer…has proven disastrous for the welfare of the great majority, as not only the unskilled and semiskilled, the sick, the unemployed, and the destitute, but even our farmers and a great number of small business owners discovered [in the 1980s.]”The embracing of supply-side economics throughout the 1980s helped to create the largest gap between the wealthy and the poor in any industrialized nation. “According to a 1998 report by the Census Bureau, the upper fifth of income earners in the United States took home almost one-half of the total income on our country (49.3 percent), whereas the lowest fifth a measly 3.6 percent – a gap between the rich and the poor twice as large as in Germany and three times as large as in Japan.”Social and economic inequalities are a direct result from the uneven distribution of wealth that occurs in a supply-side economic system.
Even with the gap endlessly widening between the wealthiest and poorest citizens of our country, consumers from all segments of the population still manage to spend more on goods and services than in any other industrialized nation. The importance of consuming goods to the capitalist system creates a number of scenarios in which environmental degradation may occur. This has created a new breed of capitalism that can be labeled as hyper-capitalism.
“The national purpose of the United States, from the very beginning, has been to let everyone make as much money as he possibly can. If they found oil under St. Patrick’s Cathedral, they would put a derrick smack in the center of the nave, and nobody would give the matter a second thought.” -Acquaintance of Peter Blake, unknown, as quoted in God’s Own Junkyard
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