This article is not about education, per se, but it does address an issue I consider to be adjacent - systemic inequity.
I’ve found myself grappling with the difficult question of how societal systems—especially trade-focused economies—can both give rise to and sustain deep inequities, including poverty and homelessness. How do systems designed to facilitate the exchange of goods and services between individuals ultimately lead to wealth accumulation for a few while leaving others struggling to meet basic needs?
The complexity of these questions has made it hard for me to internalize how such imbalances develop and persist, particularly in smaller communities and rural towns. These places, which seem to thrive on interdependence and shared resources, appear to defy the patterns of inequality and poverty that typically emerge in larger urban centers.
Yet, over time, we see that even in small communities, wealth inequality and social stratification can take root. How do systems of trade and economic structure not only develop these imbalances, but how do they persist? And why do people within these systems—who are all affected by them—often accept or even reinforce these inequities?
The Development of Inequity in Trade Systems and Small Economies
To begin, let’s consider two examples of trade-based economies: one in a small rural town and another in a more urbanized environment. In both cases, the flow of goods and services creates a dynamic where wealth is exchanged in ways that can reinforce inequality, even in tight-knit communities.
The Rural Town Dependent on Seasonal Visitors: Imagine a small rural town that relies heavily on tourism to sustain its economy. During peak seasons, local businesses—cafes, hotels, shops, and tour operators—thrive. However, during the off-seasons, when fewer visitors come through, businesses struggle to stay afloat. In this case, the town’s economy operates on a closed-loop model, where money spent by visitors circulates and supports local services. But as the seasons change, so too does the economic flow. Local workers who rely on seasonal jobs may find themselves without steady income which can potentially leave them in poverty or perhaps needing to relocate during the off-season, leaving the town with fewer individuals to share in the town's year-round pursuit of communal prosperity.
The inequity here arises not from a lack of resources but from a dependence on an external factor—tourism. This dependency creates an imbalance between wealth generation during peak seasons and a lack of resources in the off-seasons. Even though the community works interdependently to sustain itself, the wealth generated is often not evenly distributed. Those who own businesses that can capitalize on peak tourist seasons accumulate the most wealth, while others struggle to survive when income is low. This reliance on external forces reveals how even seemingly sustainable, closed-loop economies can fall prey to economic fluctuations that widen the gap between the haves and have-nots.
The Rural Family Specializing in Key Resources: In a different example, consider a small rural town where each family or group specializes in particular goods or services essential for the community’s prosperity. Some families may provide the meat or produce while others might be responsible for tools or other necessities. Here, the town operates with an informal trade system: goods and services are exchanged in a way that seems to be equitable, as everyone’s labor and resources are considered valuable to the community’s survival. However, as trade becomes more formalized or as certain individuals accumulate more resources through specialization, an imbalance emerges.
Over time, families or individuals with unique or scarce resources, or those who are able to scale their goods or services for a wider market have opportunities to accumulate both wealth and political standing. This differentiation in access to tradeable goods results in unequal access to the resources that drive the local economy. A business owner who can cater to an expanded market or those with greater control over production could increase their profits while leaving others at a disadvantage.
This is where trade systems that were once based on communal interdependence begin to develop inequality not because people are hoarding wealth or goods but because certain resources become more valuable than others, access to them becomes skewed, and the trading price of different goods and services create disparities.
The Role of Policy in Creating and Sustaining Inequity
As economies evolve, whether in small towns or large cities, policies inevitably play a significant role in perpetuating inequity. Policies designed to support certain industries, protect land ownership, or minimize taxes for businesses can create an environment where wealth is concentrated in the hands of a few, while others are left behind.
Take, for example, the urban housing market: In cities with growing populations, where demand for housing increases, developers may be incentivized to build luxury apartments or high-end real estate projects. Simultaneously, zoning laws may prevent the construction of affordable housing or limit access to property ownership for lower-income individuals. As a result, wealthier residents are able to secure property and increase their net worth, while those in poverty are pushed out of neighborhoods with affordable housing, contributing to rising homelessness.
In rural areas, similar policies can exacerbate wealth inequality. Governments might support industries that benefit the rich—such as tourism, agriculture, or mining—while providing limited resources for communities that are left behind as these industries expand. Policy decisions that favor large corporations or landowners can further entrench disparities, making it increasingly difficult for smaller businesses or families to survive. These economic policies create structural barriers, limiting economic mobility and deepening the wealth gap.
Homelessness: A Complex Symptom of Systemic Failure
While it’s tempting for some to see homelessness as a moral failing—the result of individuals' personal choices or bad luck—this view overlooks the systemic causes of poverty. The truth is that homelessness is often the result of structural inequities in society, where the economic and social systems fail to provide the necessary support or resources to those who need it most.
For instance, wage inequality and the lack of affordable housing in cities contribute directly to the growth of homelessness. In towns where wealth is concentrated in the hands of a few, those without access to sufficient income or property are left struggling. Even in communities that operate with a focus on interdependence and sustainability, the broader economic systems can make it harder for vulnerable individuals to find a foothold. Without proper policies—such as affordable housing initiatives, living wages, or access to social services—those who face challenges like mental health issues or lack of education are more likely to fall through the cracks.
The Struggle to Understand Systems of Inequity
In attempting to understand how inequity and homelessness develop and persist in trade-based and closed-loop economies, I’ve come to realize that the root of the issue lies not in individual actions but in the systems that support or fail to support the broader community. Whether in rural towns or urban centers, economies—no matter how small or large—are subject to forces of inequality that arise from economic specialization, market forces, and policies that prioritize wealth accumulation.
While smaller communities might appear to be equitable in their focus on interdependence and sustainability, even they are susceptible to forces of wealth concentration and systemic exclusion. In urban settings, the complex layers of inequality are even more pronounced, with policies often reinforcing the divide between the rich and the poor. Homelessness is a direct consequence of these failures, exacerbated by policies that criminalize poverty and fail to address basic human needs.
As I continue to reflect on these issues, I find it increasingly clear that we must rethink how we view inequality and homelessness, shifting from a blame-the-victim narrative to one that examines the root causes of economic disparity. A fairer system must take into account the collective responsibility we have to support each other, whether in a small town or a large metropolis. By doing so, we can begin to dismantle the structures that perpetuate inequity and work toward a more just and sustainable future for all.
Greg Mullen
December 23, 2024