THE BLOG

Human Potential Matters

04/06/2015 02:28 pm ET | Updated Jun 06, 2015

"The good we secure for ourselves is precarious and uncertain until it is secured for all of us and incorporated into our common life."
--Jane Addams

It's harder than ever to move up to the next rung on the socioeconomic ladder in America. And the difference between the bottom and the top of that ladder has reached epic proportions.

The top 1 percent of families in the U.S. are now 100 times richer than the bottom 90 percent, and 85 people in the upper strata of the world economy now have a net worth equal to the combined wealth of the 3.5 billion people on the lower end.

Financial mobility, once a benchmark of the American dream, is fading into the past. We are in danger of losing our vision of improving opportunities for future generations. Seventy percent of the poor people stuck in the bottom fifth of our economy remain there for life. This multigenerational poverty is a destructive force that affects all of us, not just the poor.

In his book The Spirit Level: Why Greater Equality Makes Society's Stronger, Richard Wilkinson explains that it is not so much the level of income that matters as it is the grinding realization that we have little chance of growing closer to each other in terms of income and class.

According to research at the Economic Policy Institute, compensation for chief executives at publicly traded companies climbed 937 percent between 1978 and 2013, while the average worker's compensation climbed just 10 percent. In fairness, this difference is less among chief executives and workers at non-public companies, which supports the idea of entrepreneurial solutions to our widening income gap.

The disappearance of the middle class means that we are losing our main economic and social mobility engine, and that we are creating permanent separations by class and income.

We don't trust each other anymore. According to Wilkinson, our trust level is less than half that of Sweden, where the per capita income is not as high as ours but the gaps between the top and the bottom are less.

Across the board, America is showing signs of increasing social dysfunction. Our prison population accounts for more than 25 percent of worldwide inmates, yet our country contains just 5 percent of the world's population. More than 20 percent of our children now live in poverty, defined as $23,550 per year for a family of four.

While poverty wounds its victims with negative impacts on health, brain chemistry, and social relations, the rich are also at risk of suffering the damaging effects of inequality.

Paul Piff, a leading social psychologist, invented a simple experiment where he rigged Monopoly games so that one player received far more money and resources at the start. Time after time, the experimenters noted that the "rich" players grew more aggressive and dominant as the games progressed, often demonstrating behaviors associated with bullying.

In another unique way of demonstrating the potential negative impact of wealth, Piff's researchers recorded the types of cars that stopped at crosswalks for pedestrians waiting to cross. The drivers of more expensive cars stopped far less than the drivers of cheaper vehicles. The least expensive cars stopped the most. While Piff's research illustrated more bad news about the effects of wealth (people who made more contributed less in many experiments), he did uncover a very important, positive fact:

When wealthy people were reminded of the need for contribution by a video of a starving child or a nudge about a social problem, compassion was almost immediately demonstrated in the form of increased giving and willingness to assist a stranger. It seems that when we are reminded of our human connection to individuals across the economic and social strata, we become willing to help each other. This is why the separation of classes is truly detrimental to the rich and the poor. We all lose when human potential is smashed by inequality.

So how do we begin to bridge the enormous gap between each other and the 2.8 billion people who earn less than $2 a day? It does seem impossible, but we can start with our internal viewpoints. We can close the internal gap between who we are and who we know we can be. How you see yourself in relation to the world matters more than you can imagine.

Are you still trying to improve your lot, or have you turned your dreams over to the prevailing notion that you can't get ahead? Do you see the world as an equal-opportunity playground, or have you been fooled into thinking that you are defined by the color of your skin, your age, your education level, your financial circumstance, your family, or anything but the one resource shared by all:

24 hours in a day

Of course, we all have different challenges, but remember that the actions you take during your 24 hours become part of a collective force that answers critical questions for humanity:

Who are we? Where are we going? How will we get there?

As a country, and a world, we must understand that our destinies are linked. As business owners and integral employees within organizations, we can make a difference. We can offer our unique ideas and contributions that might help close the growing gap between the rich and the poor. We can examine ourselves for prejudices founded on fashionable beliefs rather than solid values.

We can respect a version of wealth that is measured by the lives we lift rather than the money we amass. This is the rich legacy that will shrink the gaps within us and between us so that we can bear witness to the unlimited possibilities for humankind.

"Business can be the great engine that lifts billions out of poverty, but it needs to be driven with the right values. Instead of admiring people who have money, what if we looked up to those who create value? Let's redefine 'billionaire' to mean someone who has improved one billion lives."
--Jack Sim, the founder of the World Toilet Organization and a member of the World Economic Forum's Global Agenda Councils (GAC) for Water Security