The appearance of the consumer market changes according to the size of the economic gap. The depth of the country’s middle class will be a very important factor for companies aiming to expand overseas. I summarized the economic gap in the United States and its causes.

economic disparity in the United States

Many people have the image that America is a market fundamentalist country. It means a position to promote market fundamentalism and small government and to recognize the freedom of economic activities of individuals and companies. In market fundamentalism, governments basically avoid intervening in markets and individual behavior. As a result, the social security system is at a minimum, and public medical insurance is not provided.

The economic gap in the United States is also shown in figures. According to an OECD survey, the poverty rate in the United States was 17.8% in 2016, the 6th highest in the world. The world’s top country is China, followed by South Africa, Costa Rica, Brazil and India. The United States has one of the highest poverty rates in the developed world.
Reference:Global Note
Global Poverty Rate Ranking and Trends by Country

Why America’s Social Security is Poor

The United States is the only developed country without a public universal healthcare system. While health care costs are high and there is public health insurance for the elderly and low-income, private health insurance is the main market.

In the United States, health care costs continued to rise above inflation, and insurance premiums followed suit. The burden of insurance premiums is great for poverty, and about 49 million people, or about 15% of the population, are uninsured.

The idea behind cutting welfare budgets is that people should work and pave the way rather than relying on welfare. However, the employment rate in the United States has been low over the long term, and from now on manual labor will be increasingly automated.

Obamacare and American healthcare reform

Obamacare and American healthcare reform
Obamacare was born against the background of high poverty rate in America. The program was part of President Obama’s campaign to encourage uninsured Americans to join health insurance and ensure the quality of care they receive.

Although there was some criticism that requiring people to have health insurance did not respect the wishes of individuals, the system was gradually introduced after it was established in 2010. This has made it possible for individuals and small businesses who were unable to purchase medical insurance to purchase affordable private health insurance.

The enactment of Obamacare, a historic healthcare reform law, has led to a steady increase in the number of health insurance subscribers and a steady decline in the uninsured rate. Also, the growth of medical expenses has been at a lower level than before.

By curbing the growth of medical expenses, we can expect to improve living standards with the resources that were not used for medical expenses. In addition, growth in premiums paid by employers will be restrained, so economic benefits such as employment promotion and investment are expected to increase.

However, since the Obama administration, alternative proposals to review Obamacare have been put to a vote.


In the United States, wealth is concentrated in some wealthy people, causing even greater economic disparities. But as the income gap grows, so will the differences in politics and education, and it will threaten America’s democracy.