Lesson 5: Income inequality and its' consequences

Materials Needed: 
1) Internet access
2) Printer access
3) Calculating poverty line worksheet for each student
4) Notebook for each student
5) Fake money

Objectives:
Main Objective: To allow students to discover the affect that poverty has on people's lives, as well as the affect that income inequality has on society.  

1) Students will learn how the government estimates the poverty line.
2) Students will calculate alternatives to the government's estimation of the poverty line in small groups.
3) Students will discuss the possible effects of underestimating the poverty line.
4) Students will reflect on the poverty line activity, as well as the "People Like Us" clip in their journals by responding to the question "how does poverty impact people's lives?".
5) Students will enage in a critical reflection of the simulation, in order to think about what it means to have wealth concentrated in the hands of a few.

Assessments:
*Poverty line worksheet can be used as a math assessment, although performing the calculations correctly is not the main purpose of the activity.
1) Discussion post-poverty line activity- informal way to figure out what students learned from the poverty line activity. Look for students to be thinking critically about what affect an underestimated poverty line has on our society.
2) Journaling- formal way to see how individual students are reacting to the poverty line activity and "People Like Us" clip, particularly how they are feeling about what they learned from the activity and saw in the clip.
3) Discussion post-simulation- informal way to discover how students are translating what happened in the simulation to what happens in our country with income inequality and power. Look for students to be thinking critically about the impact of only a few people controlling the majority of the money.
 

Procedures:
Write this statistic on the board: 35.9 million people live below the poverty line in America, including 12.9 million children (from the U.S. Census Bureau). Ask students, has anyone heard of the poverty line before? Do you know what it is? Even if you don't know, can you make an inference? Tell students that the poverty line is used to determine individuals' and families' eligibility for particular kinds of aid and services. It is an important measure because it helps the nation know how many Americans are struggling financially each year, as well as over time.

Have students calculate the poverty line in small groups. Use the worksheet from www.tolerance.org, which can be found at: http://www.tolerance.org/sites/default/files/documents/tt_calculating_poverty.pdf. (There is an answer key for instructors at http://www.tolerance.org/activity/calculating-poverty-line.)

*The goal of this activity is to allow students to discover that the government underestimates the poverty line because the figure is based on food costs. In reality, food expenses represent 1/5 of the average American's household budget. The poverty line fails to account for housing, healthcare, childcare, and transportation.

After students have completed the worksheet, make sure to go over the answers as a class so that everyone is on the same page. Engage the students in a reflective discussion about the poverty line activity. Ask students, how likely is it that a family making $25,000 a year (an income above the poverty line) would struggle financially? Why? What are some possible effects of the government underestimating the poverty line? We know that the government has calculated the poverty line this way for decades, w
hy might they be hesitant to change the way they calculate it? Do you think the government should change the way it calculates the poverty line? Why?

Show students clip from PBS documentary "People Like Us" on "Tammy's story" (can be found on YouTube at www.youtube.com, and is approximately 8 minutes long). In this clip, students will see the hardships that one family faces living in poverty in America.

Have students reflect on the poverty line activity in their journals, as well as on the "People Like Us" clip. Encourage students to bring their feelings about what they learned during the poverty line activity and what they saw in the clip on Tammy's story into their journaling. Ask students to address the question "how does poverty impact people's lives?"

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Engage students in a simulation. In a class of twenty students*, break the students up into two groups: a group of 4 and a group of 16. Tell the 4 students that they represent the people in the top 20% of wealth in America. Tell the 16 students that they represent the people in the bottom 80% of wealth in America. Tell the students, I am going to give you $100 (fake money) and you can decide to spend it on whatever you want. The only rule is that your group has to agree. Give $85 of this to the 4 students and $15 of this to the 16 students. Be prepared for students to protest that this isn’t fair.

Give the students about 10 minutes to decide what they want to do with the money. Ask each of the groups to have a representative share what they decided to spend the money on with the rest of the class. 


Engage students in a discussion about the activity. Ask them, how did you feel in the group with the $85? How did you feel in the group with the $15?

Tell students that this simulation represents wealth inequality in the U.S. Ask students, what are the consequences of having lots of wealth concentrated in the hands of a few people? Is everyone’s voice being heard? Why or why not?  

*Note:
These are the statistics to use to determine the appropriate numbers for the simulation, as this will fluctuate depending on the number of students in a given class:

"As of 2007, the top 1% of households (the upper class) owned 34.6% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 50.5%, which means that just 20% of the people owned a remarkable 85%, leaving only 15% of the wealth for the bottom 80% (wage and salary workers)." (http://sociology.ucsc.edu/whorulesamerica/power/wealth.html)