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2013
Recent Developments in Egypt and the Region – ANND Statement (September 3, 2013)
The Arab NGO Network for Development (ANND) has issued a statement regarding their perspective of the current developments in Egypt. ANND describes the efforts they have made in achieving public democracy, social justice and stability during the unrest being faced in the Arab community. The network stresses the importance of ending all violence from conflicting sides to provide a safe basis to encourage economic and political development in Egypt. They recognize that the media has been adding to the cause of violence and therefore ask that freedom of speech should be safeguarded and institutions formed to ensure social justice is being served - particularly by achieving social equality. (Arab NGO Network for Development)
Income Inequality in Asia Leads to Illicit Financial Flows (August 6, 2013)
In an article for Financial Transparency Coalition, a transparency watchdog, economist Ann Hollingshead describes the relationship between income inequality, wealth and illicit financial flows in the context of Asian economic development. In Asia, a strong export sector and high overall growth rates have led to the creation of a large number of extremely wealthy individuals. In turn, these have attracted banks, which play a role in moving money out of these countries. This has adverse consequences for Asian states' ability to provide social services, eroding governance and fostering corruption. (Financial Transparency Coalition)
The Non Zero-Sum Society: How the Rich Are Destroying the US Economy (January 29, 2013)
Recent reports reveal an 8.2% wage increase for the wealthiest US citizens while the majority is increasingly employed in low-wage jobs. This highlights the widespread inequality in the US and the eroding purchasing power of the general population. The growth of low-wage jobs coincides with the decline in labor unions since the 1950s due to an increase in anti-union laws in the US. Neo-liberal globalization, technological changes and anti-union corporations like Wal-Mart have all contributed to the rise of low-paying jobs, stagnating wages and a decline in purchasing power. According to Robert Reich, this trend will eventually hurt the wealthiest classes since as much as 70% of the US economy is based on consumer spending. Hence, he argues that this is a “Non Zero-Sum situation” where wealthy Americans would profit more from lessening their monopoly on the economy. While this is an optimistic outlook, it ignores the fact that wealth of the 1% has increasingly been decoupled from the “real economy” through financialization and foreign investments. (Common Dreams)
Injustice Overshadows Growth in Chile (January 18, 2013)
Chile’s success in shielding itself from the current financial crisis is validated by its 2012 performance highlighting positive trends in GDP. However, Chilean citizens reveal that Piñera’s right-wing administration has done little to alleviate injustices dating back to the Pinochet dictatorship resulting in continued protests from civil society. Social movements are advocating for constitutional reforms that precede Chile’s democratization and thus hinder progress in establishing a just and truly “democratic society”. Economic injustice was apparent in a 2012 survey showing that income of the affluent is 35 times more than the poorest. Moreover, recent economic growth mainly due to the unusually high price of copper is not sustainable in the long run as market values and resource availability change over time. Thus, it is important to look beyond the GDP values to wealth distribution that will ultimately determine Chile’s long term economic success. (IPS)
2012
Income Inequality May Take Toll on Growth (October 16, 2012)
In this article Annie Lowrey highlights the rising share of US income going to the highest earners. She argues that income inequality has a big impact on economic growth and, quotes an IMF economist, “when a handful of yachts become liners while the rest remain lowly canoes, something is seriously amiss.” While both US presidential candidates agree that restoring the “middle class” is crucial to the economy, they disagree strongly on the policy alternatives. Outcomes of these policies will be limited if there is no solid reform to the US economic and financial system. (New York Times)
Gini Back in the Bottle (October 13, 2012)
The article explores the “boom at the bottom” of Latin America. With incomes of the poorest surging, the inequality gaps are narrowing in countries like Argentina. “Although Latin America saw only half the average GDP growth of emerging Asia over the past ten years, its poverty rate fell by 30%. Around a third of the decline is due to improvements in income distribution.” This transformation results from governments’ investment in secondary education and targeted social spending on the lowest income earners. The biggest challenge for the future of the region is believed to be the sustainability of the scheme. Sustained growth in the past decade has brought in sufficient tax revenue to boost both education spending and transfers at the bottom without pushing up tax rates. (Economist)
Luxury Home Builder Reports a Revenue Gain of 41% (August 22, 2012)
While the economic crisis has harmed millions of ordinary citizens, the wealthy have enjoyed a housing boom of their own. Toll Brothers, the largest US luxury home builder is reporting record profits, claiming that it is enjoying the most sustained demand for luxury homes in over five years. Since the housing bubble collapse in 2008, millions of US homes were lost to foreclosures, leaving home owners very vulnerable. Inequality is an increasingly widespread issue that is clearly visible in the case of the housing market. (Reuters)
The Reproduction of Privilege (March 12, 2012)
An integral part of the “American Dream” is the idea that post-secondary education dissolves long-standing class hierarchies. Instead of serving as a springboard to social mobility, however, college education has reinforced class stratification the last six decades. Today, seventy four percent of those attending colleges classified as “most competitive” come from families with earnings in the top income quartile, while only three percent come from families in the bottom quartile. A vicious circle is established in which, as children of the rich do better in school, and those who do better in school are more likely to become rich, an even more unequal and economically polarized society is crafted. (New York Times)
To Save the Earth It Is Essential to Change Consumption Patterns (March 1, 2012)
Social Watch, an international network of citizens organizations aimed at eradicating poverty and fighting climate change, has released its annual report specifically looking at the upcoming Rio +20 summit on sustainable development. Social Watch urges governments to opt for a wider understanding of sustainable development, arguing that current consumption and production standards are unsustainable and a testimony to the disproportionate use industrialized countries make of the earth’s non-renewable resources. In order to counter this state of affairs, the world requires “a radical and urgent transformation in current approaches to economic growth and stability and to patterns of production and consumption.” (Social Watch)
Squatting Law Will Only Criminalise the Homeless. Let's Demolish Clause 130 (February 20, 2012)
A new law is being passed in the UK that makes the squatting of unoccupied residential property no longer a civil, but a criminal offence, punishable by a maximum fine of £5, or a sentence of up to a year. At a time in which squatting is becoming more and more associated in the public mind with political activism, imprisoning occupiers of public spaces becomes an attractive option to silence government critics. In this guardian piece, author Tanya Gold argues that rather than criminalizing squatting, the government should concentrate its efforts on tackling the real scandal, namely the concentration of wealth which results in nearly 930,000 UK homes being empty, most of them for over six months. (Guardian)
The End of Nothing (February 9, 2012)
The conservative think tank Manhattan Institute recently published a report that declared “the end of segregation in the US.” Contrary to what this report maintains, however, segregation in the US is far from over. Although it has declined in the last four decades, segregation remains remarkably present. Moreover, the changes that did occur seem of little consequence to African-Americans living in ghettos that, although smaller than 40 years ago, are still massive. This Boston Review article explores the many reasons why the US, as a matter of public policy, should continue to be committed to ending segregation. In doing so, it highlights importance issues that are of relevance far beyond US boarders. (Boston Review)
Those Bad Old Days are Still with Us (February 6, 2012)
An estimated of 2 million domestic workers in the US regularly suffer from racism, class and occupational discrimination and moral degradation. A 2006 study revealed that in New York State one in three domestic workers experiences abuse. This article from the Institute for Policy Studies takes the recently Oscar-nominated movie “The Help” as a starting point to cast light on the continuing struggle of domestic workers to gain respect and recognition and to fight for their rights. It suggests that until domestic work is not considered “real” labor instead of just a series of tasks and duties women are born knowing how to do, the exploitation of domestic workers will not stop. (Institute for Policy Studies)The Problem That the Buffett Rule Won't Fix (February 2, 2012)
In this op-ed, Bloomberg columnist Michael Kinsley argues that the "Buffett Rule," a rule proposed by the Obama administration to counter the income inequality between those making more than a million dollars a year and those that do not, will miss several crucial marks. According to Kinsley, the Buffett Rule will not only have a minimal effect on income distribution because of the small amount of people that will be subject to it, but it will also dramatically move upward "the invisible line that divides the middle class from the rich in the public's imagination." Kinsley welcomes the fact that the ultra-rich will finally pay more taxes, but fears that its implementation will make the chances of a general progressive tax system in the near future even slimmer. (Bloomberg)
Finding Balance in Chile (February 2, 2012)
In 2011, a movement that started as a protest against a mega-dam Project in Southern Chile, transformed into large scale student demonstration in Chile’s capital, Santiago. In a country in which the education system is largely in private hands, students demanded lower educational costs and stronger public high school and university education. More generally, the protestors denounced Chile’s vast inequality, which is the largest between all OECD countries. This World Policy Institute article situates Chile’s 2011 protests in the country’s history of upheavals and cacerolazos. Lessons drawn from Pinochet’s opposition are presented, and former Chilean president Ricardo Lagos outlines how, after pot banging protests inevitably die out, opposition can turn into policies, and policies into action. (World Policy Institute)
Enough is Enough (February, 2012)
Two renowned academics, a law professor at Yale and an economist at Berkley, have recently published articles in the New York Times making a cogent case for a tax reform that would limit the average incomes of America’s richest. The maximum would be set as a specific multiple of the minimum wage and all income over a given multiple of that would then be taxed a 100%. The impact of such tax would be vast: Society’s most wealthy would have a vested interest in the wellbeing of society’s least wealthy. Today an agreement exists regarding the need for a minimum wage. This Monde Diplomatique article asks one simple question: Why not a maximum? (Le Monde Diplomatique)
Do Progressives Have to Be Loser Liberals? (January 24, 2012)
The main difference between liberals and conservatives is often said to be the extent to which they are willing to interfere in the market to redistribute money. In this op-ed article, Dean Baker from the Center for Economic and Policy Research defies this view, arguing that the difference does not lie in the redistributive policies a government does or does not implement, but rather in the actions it takes to determine the initial distribution. The issue is not “leaving our neighbor by the side of the road,” Baker states, but the fact that our neighbor has been thrown out of the bus. The real battle is thus not over shuffling around a few crumbs, but over setting the rules. The first step “to get our neighbor back on the bus” is to say as clearly as possible what exactly happened. (Al Jazeera)
2011
Ethics and Inequality (November 28, 2011)
At a time in which the Occupy movement all over the world is denouncing the vast disparity between the 1% and the 99%, asking what it is about inequality that is morally objectionable becomes of uttermost importance. After all, people are unequal in many ways: Some work harder, some are more talented, some take more risks. Advocating for greater equality, however, does not mean that all individuals are the same or ought to earn the same. Rather, defending equality is based on the democratic idea of creating a community where every citizen can make his voice heard in political decisions. This article of the Boston Review elucidates why, when money is speech, corporations are persons and politicians depend on contributions to be elected, democracy’s founding ideals are being deceived. (Boston Review)
Divided We Stand: Why Inequality Keeps Rising (December 2011)
Despite three decades of increased economic growth, the gap between rich and poor in OECD-countries has reached its highest point in 30 years, a new OECD report demonstrates. According to the organization’s Secretary-General, Angel Gurria, the report underlines the fact that economic growth does not necessarily benefit everyone, and that decisive government intervention is of the essence. At the very least, governments must reinstate higher tax rates for the wealthy and allocate more resources towards vital areas of social life – such as health, education and social protection - that have become increasingly inaccessible for millions of people. (OECD)
Global Inequality: Tackling the Elite 1% Problem (November 28, 2011)
At a time in which the Occupy movement appropriates the concept of the elite 1% versus the 99%, looking beyond national inequality to address global inequality is of uttermost importance.Despite the massive incomes of Indian mega-millionaires, for example, the poorest 5% in the US earn about as much as the richest 5% in India. How then, can global inequality be reduced? Efforts to tackle national inequality have revealed that countries with better redistributive policies and higher levels of government spending have lower inequality than countries with low social expenditure. In this article journalist Jonathan Glennie discusses the option of implementing a similar redistributive scheme at the global level. (Guardian)
Business as Usual: Top Directors Get 49 Per Cent Pay Rise (October 28, 2011)
A study of British “Income Data Services” (IDS) published last week revealed that the chief executives of Britain’s largest companies earned an average of £3,855,172 last year. This represents a 49 per cent pay rise. In sharp contrast , the average private-sector pay award this summer gave workers a raise of merely 2.6. per cent – only half of the most recent annual inflation. These figures suggest that little has been learned from the financial troubles of the last four years. Britain’s Unite union believes the IDS report to be an opportunity to curb executive pay and calls for shareholders to be given more power to hold directors accountable. (Independent)
Youthful Members of the Full-Time Precariat (15 September, 2011)
Throughout the last two decades, job insecurity for young Europeans rose radically. This article argues that the “European Precariat,” a new social class of young, unemployed or underpaid individuals is emerging. Disillusioned with their government’s failure to resolve of the ongoing financial crisis, the European youth has become increasingly radicalized, demonstrating in the streets of Paris, Athens, Madrid and London and joining extremist political parties. However, the European precariat is not the cause, but rather the result of a larger problem. “The governments of developed countries have entered into a pact with the devil by administrating a fundamentally unsustainable system, which has now broken down.“ (Polityka)
Tagore and the Idea of Cooperation (July 11, 2011)
In the early 20th century, Nobel Laureate Rabindranath Tagore wrote that a collectively owned economy was the correct response to India’s growing concentration of power. A collectively owned economy is one where resources, such as land and capital, are collectively owned by the producers. The author of this article argues that Tagore’s vision holds true today, when India’s wealth is increasingly consolidated. The current financial crisis and the collapse of microcredit has proven that alternative forms of ownership must be investigated. Giving workers ownership and power when global prices fluctuate will be more effective than “paternalistic policy models for ‘empowering the poor.’” Growth can be made inclusive if India pursues an ethical mode of production, and alters power relations. (The Hindu)
Thomas Pogge on Global Poverty (May 31, 2011)
Author of “World Poverty” Thomas Pogge argues that global poverty is on the rise, even while the average global income is increasing. In general, the poor’s share of global profits has decreased, unequal income and wealth distribution has increased, and the actual numbers of those living in poverty are larger than current models suggest. According to Pogge, citizens themselves are responsible for the continued unequal distribution of resources, because they have the means to change things. He argues for a reassessment of power structures, global arrangements, and institutional roles so that the poor can improve their lives and reclaim their human rights. (Policy Innovations)
A Worry for Beijing That Goes Beyond Cities (April 25, 2011)
China’s gap between rich and poor is growing at an alarming rate, and is prompting government authorities to make changes in an attempt to prevent social unrest. While economic reform has raised incomes for many Chinese, making some phenomenally wealthy, scores of millions remain mired in deep poverty. The growing gulf is breeding resentment, which may prompt broader class conflict. (New York Times)
Inequality, the New Dynamic of History (February 6, 2011)
Policy makers around the world have identified the growing divide between rich and poor as a factor of increased instability. While proponents of the market system advocate for changes in redistributive policies, others have voiced the need for adopting more radical changes to global economic structures. Governments are removing stimulus measures established after the global economic meltdown and are replacing them with austerity programs in an effort to mend battered finances. Yet questions loom about the effects such actions will have on the working class and what this means for global inequality. (The Guardian)
Egypt Youth Unemployment Was 'Time Bomb': IMF Head (February 1, 2011)
Director of the International Monetary Fund (IMF) Dominique Strauss-Kahn claims that he had repeatedly warned policy makers about the possibility of revolution in Egypt over the past year. Strauss-Kahn spoke out last summer at a meeting in Morocco, where he raised concerns about the specter of general instability in the region due to vast inequality in income distribution and high levels of youth unemployment. Strauss-Kahn's comments clash with multiple IMF staff reports from recent years, which lauded Egypt's wide-ranging reform efforts and policies that guaranteed greater macroeconomic stability. (CNBC)
IMF Raises Spectre of Civil War as Global Inequalities Worsen (February 1, 2011)
The International Monetary Fund (IMF) identifies global inequality as a major cause of the economic crisis and urges nations to address it. A recent paper released by the IMF states that workers have steadily lost their "bargaining power" relative to owners of capital. To reverse this trend, governments should institute radical changes to their tax codes and offer debt relief to workers facing an escalating crunch from low wage growth and increasing food and energy prices. (The Telegraph)
The Rise of the New Global Elite (January/February, 2011)
The gulf between rich and poor around the world is widening. The "transglobal community of peers," from Lagos to Beijing, often educated at elite Western institutions, tends to view themselves as having more in common with each other than their next door neighbors. Many economists argue that the world's growing income inequality is at least partly responsible for the economic crisis. In the end, the world's rich have two options: "suppress dissent or share their wealth." Without a major and concerted effort to redistribute global wealth the world is surely headed for deeper social and economic crisis. (The Atlantic)
2010
How Billionaires can Help the World (August 23, 2010)
"Philanthrocapitalists" that want to pay back parts of what they have earned from the society, should be doing so in a way that can accomplish more than just a "scratch on the surface." Instead of donating large parts of their capital to various foundations, like Bill Gates' "Giving Pledge," owners of multinational corporations should address issues like offshore bank accounts and corporate tax avoidance - topics that actually cuts to the core of social injustice and world poverty. This article says "progressive billionaires should concentrate on cleaning their dirty laundry first," before imposing their own priorities and agendas through new foundations. (Open Democracy)
2009
Creating Common Grounds (July 15, 2009)
Global capitalism creates social inequality and increases the gap between rich and poor. This article suggests that the world needs a global conversation on how to bridge this social rift. New communication technologies can create alternative realities, contributing to the possibility of a more equal distribution of global wealth. (Zmag)
2008
A World in Flux: Crisis to Agency (October 16, 2008)
While economic growth produced millions of new jobs since the early 1990s, income inequality has grown dramatically in most regions of the world. From 1990 to 2005, the gap between people living in extreme poverty and extreme wealth grew by 70 percent. Economic deregulation, international capital flows and the global financial crisis will further widen this gap between the world's rich and poor. The report promotes a "Decent Work Agenda" including social protection and respect for workers rights in order to obtain a more equal global labor market. (International Labor Organization)
World of Work Report 2008 (October 2008)
The financial crisis provides a rare opportunity for world leaders to reform the structures of global governance. This article suggests that a global summit should launch a reform of the financial system. Governments should in future regulate financial companies and control currency speculation through a tax on all currency transactions across borders. A new financial system must also reduce income inequalities. Today, 20 percent of the world's population receives over 80 percent of the world's income. (OpenDemocracy)
An Era of Disparity (July 22, 2008)
Income inequality between the rich and the poor is accelerating. There are 500 billionaires worldwide, whereas 1.2 billion people live on less than a dollar a day. One-third of the 4.4 billion people who live in poor countries, do not have access to safe drinking water. The author says that the increasingly globalized economy unfairly allows a small percentage of the people to benefit. Instead, we should favor local workers and firms because a local economy would empower a greater majority of the world's people. (Countercurrents.org)
Global Slowdown: The LCDs' Sword of Damocles (July 17, 2008)
This World Economy and Development in Brief article states that increased exports and foreign investment have led to strong economic growth in some poorer countries. But, the growth has only benefited a small section of these countries' populations. The 2008 UNCTAD Least Developed Countries Report says that countries should increase public spending through well-targeted programs in areas of primary education and create jobs for their growing populations.
GDP: The Measure and Mismeasure of the Economy (June 30, 2008)
This Canadian Broadcasting Corporation article criticizes world leaders and economists who use Gross Domestic Product (GDP) as an indicator of quality of life. GDP measures overall output and strength of a country's economy. But, the author says "GDP is a measure of quantity, not quality," as it fails to reflect the income gaps between the rich and the poor. He proposes alternate measures like the UN Human Development Index and the Genuine Progress Indicator that use health, environmental impact and standard of living as indicators of the quality of life.
Spreading the Benefits of Globalization (March 26, 2008)
Increasingly, the public, economists and development analysts are questioning whether globalization has delivered on its "promised benefits." Various reports show a trend of increased inequality in the world, between the North and the South, but also within both poor and rich nations. The author concludes that a tiny group at the top of global society reaps the rewards of globalization, while the vast majority of people miss out. He supports drastic re-distribution from the top down, such as increasing income tax for top earners, and eliminating income tax for those earning less than a given average national income. (World Economy & Development in Brief)
Measuring Wealth by the Foot (March 16, 2008)
Many fear for a global recession, but the world's billionaires are not worried. This New York Times article reports that billionaires are continuing a game of "one-upmanship" around who has the longest, most sophisticated yacht.
Globalization 'Localizes' Inequality (March 11, 2008)
Global income inequality between rich and poor countries is decreasing says Inter Press Service. The UN Conference on Trade and Development (UNCTAD) reports that real per capita incomes are on average 18 times higher in richer nations than poorer nations, compared to 24 times higher in 1980. But, this data fails to explain why poverty and hunger are increasing worldwide. In fact, economic inequality within richer and poorer nations has also increased markedly, leading to violent protests in India and large-scale demonstrations in China.
Globalization and War (March 10, 2008)
Political scientist Susan George argues that "corporate-led, finance-driven globalization" has led to huge and ever increasing inequality. Globalization has been good to those in the tops of societies, but the system as a whole faces crisis: The World Trade Organization finds itself in deadlock, and institutions such as the World Bank are less important than before. George argues that scarcity of food and water, climate change, and the risk of an economic recession will place further, extreme stress on the world system and will lead to increased violent conflict. (Transnational Institute)
2007
Oil Price Rise Causes Global Shift in Wealth (November 10, 2007)
The continuing rise of global oil prices is causing a shift in wealth in favor of oil-producing countries. For some of these countries, such as Iran and Venezuela, the new wealth brings a higher degree of economic independence, which may strengthen their position on the international political arena. Many economists, however, note that oil-producing countries fail to diversify their economies and that wealth remains concentrated among a few. (Washington Post)
The Newest Billionaires: China's Economy Churns out Dozens (November 6, 2007)
Second to the US, China has the largest number of billionaires in the world. Depending on where they choose to invest their fortunes Chinese billionaires could influence global political and economic relations. Commentators suggest that the growth of individual fortunes in China may also alter the country's "cultural landscape." China has a per capita income of less than US$1,000 a year and the inequalities in wealth and income could destabilize Chinese social relations. (International Herald Tribune)
Are the Poor Getting Poorer? (October 31, 2007)
This article on poverty and inequality from WorldNet Daily is an example of how statistics can be misused to prove a case. The author uses statistics on the frequency of color TV and microwave ownership to prove that poverty does not exist in the US. The author also argues that ultimately poverty is self-inflicted and that people could escape their "perceived poverty" if they were willing to work and get married. The author's interpretation of household consumption data fails to take into consideration relative prices of consumer goods, which in any case are inadequate indicators of wealth in a country where luxury goods are more affordable than necessities such as basic health care.
Investment, Inequality Growing Globally (October 21, 2007)
Three reports by the United Nations Conference on Trade and Development (UNCTAD), the World Bank and the International Monetary Fund (IMF) analyze growing global inequalities of wealth and income. Although foreign direct investment is surging worldwide, most investment still takes place in rich countries. The IMF says that trade liberalization has increased income inequalities while the World Bank suggests that countries must promote agricultural and rural development to level out global earnings. (Jamaica Glearer)
American Sickness: Diagnosis and Cure (October 16, 2007)
This article focuses on the huge inequalities in the United States. The economic differences are particularly well reflected in statistics on US citizens' health. In the Harlem district of New York, life expectancy of male infants matches that of Belize and Tanzania and the average life expectancy is lower than in Bangladesh. Poverty and job insecurity leave a great number of US citizens without any or sufficient insurance and access to health care in general is often limited. The authors point to success in other industrialized nations and call for higher spending on education and increased levels of taxation to create a more equal society. (openDemocracy)
Scarcity Amid Abundance (October 16, 2007)
This Inter Press Service article investigates the links between economic growth and inequality in Latin America. While Latin American countries are among the world's largest food producers, poverty and hunger are huge problems in the continent. The article looks in detail at the various projects and policies that have been implemented by governments in Brazil, Venezuela, Argentina and Uruguay to reduce hunger and concludes that they have been relatively successful.
Inequality in India and China: Is Globalization to Blame? (October 15, 2007)
The Asian continent has experienced increasing economic inequality over the last two decades. Critics suggest increased exposure to international market is to blame. On the other hand, the author of this YaleGlobal article argues that the expansion of industrialization in countries such as China and India has created many jobs and lifted a lot of people out of poverty. But, in both countries poverty declined prior to economic liberalization. The author argues that the Indian and Chinese case studies alone cannot establish the effects of globalization on income distribution.
Stemming the Trickle-Up Effect: Finding Alternative Economies (October 11, 2007)
Income and wealth inequality is growing in the US. The richest one percent now earn as much as the bottom 33 percent of the population. Concerned citizens are establishing "solidarity economy networks" to promote social justice. These networks follow in the wake of many alternative wealth-creation institutions that workers and citizens have set up to create more equal employment and wage arrangements. Economic experts gathering in Washington in October 2007 agree that setting up communities such as the solidarity networks and employee stock ownership plans could be a good approach to reduce the inequalities in the US economy. (Inter Press Service)
Trickle-Up Economics: New Report Reveals Staggering Global Wealth Concentration (October 8, 2007)
From 2001 to 2006, world wealth increased significantly, with a 7.5 percent increase in 2006 alone. Over the same period, the house-holds who hold less than US$100,000 in assets saw a decline in wealth. The Boston Consulting Group estimates that 0.7 percent of the world's households now hold a third of the world's financial assets. A report from the same group draws attention to the money made from handling these valuable assets – 111 wealth managing firms who were surveyed have an astonishing average profit margin of 34.7 percent. (Too Much: A Commentary on Excess and Inequality)
Behind London's Boom, Billionaires from Abroad (October 5, 2007)
London is now rivaling New York as the world's financial capital. Business is soaring and the city is experiencing an influx of foreign billionaires spending their money in the city. The foreigners are attracted by London's strategic business location and by very favorable tax arrangements. London officials are seeking to attract rich business people bringing money to town, and London mayor Ken Livingstone has established offices in China and India to attract high-end investments. However, the expansion of wealth in London is driving up prices making it difficult for ordinary inhabitants to continue living in an increasingly elite city. (Wall Street Journal)
Massive Inequality is Unexamined Fault Line Behind GM Walk-Out (October 2, 2007)
In the first half of the twentieth century, US labor unions struggled successfully to improve wages and working conditions. The unions had support from high level politicians, among them President Franklin D. Roosevelt, who proposed the idea of a maximum wage to counter income inequality. Even though the Congress never adopted the maximum wage, high wages were held down by high taxes. Since then, US administrations have lowered tax rates and the strength and influence of labor movements has been diminished. Organized General Motors auto workers are now trying to reverse the trend, as was demonstrated in their factory walkout in October 2007. (AlterNet)
For the Yachting Class, the Latest Amenity Can Take Flight (October 2, 2007)
The very rich have long been spending their money on fancy cars and big yachts. While a yacht is still a desired luxury product for those with high incomes, a yacht with a private helicopter and submarine is now the "real deal." Reports from the Monaco boating fair indicate no reduction in luxury purchases despite higher oil prices, a falling dollar and warnings of global warming. Rather the very rich tend to buy bigger and more expensive yachts, and to equip them with ever more advanced accessories. The report serves as a reminder of the extreme differences in a world of increasing inequality in income and wealth. (New York Times)
Globalization: End of the Beginning, or Beginning of the End? (September 11, 2007)
This Globalist article compares the US and Chinese economies following decades of economic globalization. The two countries are experiencing equally worrisome levels of income inequality and turbulence in their financial markets. This has caused fear, even among pro-globalization advocates. The author suggests that the global economy is headed towards a rough patch. He does not necessarily advocate for an end to globalization but rather a reform of the nature of globalization as we know it. He predicts that the structure of the global economy will have to change to counter the wide global and national disparities.
Managing Globalization: To Reduce Poverty, Money Isn't Everything (August 21, 2007)
This International Herald Tribune article argues that the standard of living in Venezuela and Brazil has risen in recent years. In Venezuela, President Hugo Chavez has implemented land reform and redistributed Venezuela's oil wealth to reduce inequality. But some have criticized Chavez, because his programs have prioritized the poor who are loyal to the regime. In Brazil on the other hand, progress appears to have been more "widespread" than in Venezuela and easier to measure.
All Fall Down (July 30, 2007)
Ten years after the devastating Asian financial crisis, economies in the region are growing, but there is also greater poverty and inequality. Seeking to protect their economies, the Association of South East Asian Nations (ASEAN) have come together with China, South Korea, and Japan to form the "ASEAN Plus Three" financial group. This agreement will enable member countries to "swap reserves if speculators again target their currencies." But former US Treasury Secretary Robert Rubin argues that is it almost inevitable that there will be severe financial crises in the future around the world. (Foreign Policy in Focus)
Experts: As Economy Grows, Income Disparity in Latin America Widens (July 30, 2007)
Despite some solid economic growth in various Latin American countries, the region has the greatest income inequality in the world. Latin America's economy has "grown between 4 to 6 percent annually since 2004," but "200 million people still live in poverty and 81 million of them in extreme poverty." Rodrigo Guerra, head of the Social Observatory of the Latin American Bishops' Council, said that the inequality is quickly increasing in all Latin American countries. The article calls for governments to invest in social programs, to reform the education and the judiciary in order to reduce such disparity. (Catholic News Service)
In China, an Unsettling Gap Grows (July 15, 2007)
According to a recent study by the Chinese Academy of Social Sciences, the wealthiest 10 percent of Chinese control 40 percent of all assets while the poorest 10 percent possess just 2 percent of these assets. This article discusses how a growing inequality gap in China is upsetting Chinese socialist leaders who fear that inequality could lead to instability instead of "a harmonious society." Today, the central contradiction in China's economic rise lies between the urge to consume and the struggle for social equality. (Chicago Tribune)
Inequality Rising Despite Promises of Globalization, UN Expert Says (February 9, 2007)
Although proponents of globalization predicted it would result in a "more equitable world with equal opportunities," global inequality both between and within countries has instead increased. A United Nations senior economist has stated that "full, productive and decent employment not economic liberalization" is the only way to effectively reduce poverty and narrow these global income gaps. (UN News)
Rich Growing Richer Faster than Poor in Developing Asia (2007)
This Asia Development Bank (ADB) study argues that there is a growing gap between rich and poor in Asia as rich people are growing richer far faster than poor people are improving their lot. The report shows that out of the 22 countries analyzed, China and Nepal experienced the widest wealth gaps. The report argues that urban areas have grown richer than rural areas, and "highly educated households" assembled more wealth than "less educated ones."
2006
Press Release: Growth Prospects Are Strong, but Social, Environmental Pressures from Globalization Need More Attention (December 13, 2006)
Under the "central scenario" of the World Bank's Global Economic Prospects 2007 world GDP will roughly double over the 2005-2030 period with developing country exports accounting for a significant share of the increase. While this growth could halve the number of people living on less than a dollar a day by 2030, the report also acknowledges that growing income inequalities and global warming could "jeopardize long-term progress." Along with reducing barriers to trade, the report calls for stronger international institutions to tackle the stresses on the global commons. At the national level the Bank calls for government investments in education and infrastructure "to ensure that the poor are incorporated into the growth process."
Press Release: Pioneering Study Shows Richest Two Percent Own Half World Wealth (December 5, 2006)
The Helsinki-based World Institute for Development Economics Research of the United Nations University (UNU-WIDER) has released the most comprehensive study ever performed of personal wealth – as opposed to income. Based on data from 2000, the study finds that one percent of the world's adults alone owned 40 percent of the world's wealth, while the bottom half of adults in the world together owned less than one percent. Absurdly, many individuals in high-income countries incurring large mortgage and consumer debts are among the 'poorest' in terms of household wealth. Still, North America's 6 percent of the world adult population accounted for 34 percent of world household wealth.
Globalization and Growing Disparities (July 7, 2006)
For two decades, "protagonists" of the Washington Consensus have promised that neoliberal policies would soon make everyone better off. Yet, these policies have failed to reduce hunger, malnutrition and poor health conditions. Inequality keeps rising. Looking at India, the author warns that large inequalities could lead to social unrest that could undermine the very conditions for economic growth in the country. Some Latin American countries, on the other hand, "have begun prospering only after discarding the Washington consensus." (ZNet)
Reducing International Inequality- UN Report (July 2006)
UN Under Secretary General for Economic and Social Affairs Jose Antonio Ocampo comments on the UN's World Economic and Social Survey 2006 . Ocampo links rising international inequalities to volatility in the global markets, weak domestic economies and insufficient infrastructural development. The Survey pinpoints the processes that exacerbate these disparities and suggests a four-tiered agenda to reverse international economic divergence. (South Centre)
Unbridled Capitalism Will Lead to Very Real Problems (April 17, 2006)
In this interview, Harvard economist Kenneth Rogoff warns that the unfair distribution of wealth within most countries will lead to serious social tensions all over the world. As big company profits reach record highs, an ever-smaller percentage of the population gains from high economic growth rates, while most workers see their wages stagnate. As a result, governments could lose public support for policies promoting deregulation of market activities. (Spiegel)
Globalization Will Increase Inequality in Developing Countries (February 28, 2006)
This article identifies causes and solutions to the high and rising inequality across the world. In many poor countries, the lack of access to higher education hinders people from participating in the globalized economy. In addition, the market itself produces failures, such as financial crises, that increase intra-country inequality. Only serious political commitment of governments and fair multilateral economic and social cooperation among rich and poor countries can stop the rise of worldwide inequality. (South Centre)
World Economy Giving Less to Poorest in Spite of Global Poverty Campaign Says New Research (January 23, 2006)
According to a publication of the New Economics Foundation, the world's poorest benefit very little from economic growth. Moreover, "our obsession with growth" fails to provide long-term, environmentally sustainable solutions to people's well being. While economic growth can contribute to better living conditions, the report encourages alternative approaches to global economic challenges.
Growing dissent (January 23, 2006)
Many economists see growth as the ultimate answer to all problems, including poverty. Nevertheless, the poor's share in its benefits has decreased constantly in recent decades and the environmental costs of growth have steadily grown. This article calls for a new global economic system with a global income distribution arrangement to assure poverty reduction and environmental sustainability. (Guardian)
2005
Unequal Gains (December 22, 2005)
Global inequality has sharply risen during the last decades. The average income of the richest 20% of the world's population in 1960 was 30 times higher than that of the poorest 20%. In 1995, this number had increased to 82 times. This article takes on the common arguments of neoliberal policymakers, who deny this phenomenon. (Telegraph)
Review of the First United Nations Decade for the Eradication of Poverty: 1997-2006 (December 12, 2005)
This report by the UN Secretary General looks at the last ten years of worldwide efforts to reduce poverty. Although poverty has decreased in Asia, the UN observed little progress in Latin America and especially Africa. These regions suffer from wide income inequalitiy preventing economic growth from translating into reduced poverty. (United Nations)
All Types of Inequality Are Not Created Equal: Divergent Impacts of Inequality on Economic Growth (December 2005)
This report examines the complexities of defining inequality within and between countries. Using ethnic and gender disparities as case examples, the author argues that inequality can lead to short and medium term economic growth and development, but may come at a long run detriment to the marginalized group. The author calls on countries and development agencies to take into account the diversity of economic needs among different sectors of society and to make "growth and equity compatible." (Levy Economics Institute of Bard College)
MDGs Mask Injustice and Inequality in Latin America (November 2005)
By focusing on the Millennium Development Goals (MDGs), countries risk distracting from problems of injustice and inequality. This is particularly relevant for Latin America, the most socially unequal region in the world. Rather than endorsing neoliberal economic policies, governments must seek to achieve the MDGs "in a way that tackles injustice and inequality." (id21)
A Compendium of Inequality (October 2005)
The United Nations Development Program (UNDP) published the 2005 Human Development Report just a week before the Millenium +5 Summit. The release was intended to influence governments to promote a more incisive approach to development, aid and security policies. This briefing paper analyzes the report and agrees with the UNDP's concern that in the current path towards achieving the Millennium Development Goals, the lack of distribution and social justice policies is leading to a "blind spot." (Global Policy Forum and Friedrich Ebert Foundation)
Reducing Poverty by Tackling Social Exclusion (September 2005)
Very often, poverty and social exclusion coexist. People who are discriminated against on the basis of their race, religion or gender can not claim their political and economic rights. As in Indonesia, Sudan or Kosovo, conflict and insecurity grow and governments' development policies fail to reach the socially excluded people with almost no opportunities to build a better life. This paper from the UK Department for International Development deals with social exclusion and the ways in which governments and NGOs can eliminate it.
The Root Cause of Poverty in Latin America (September 13, 2005)
Political leaders rarely discuss redistribution in their speeches on development. They should. The experience of several Latin American countries shows that social policies of redistribution, rather than privatization and liberalization, strongly contribute to reduce inequality and promote development. (Inter Press Service)
Globalization Driving Inequality, UN Warns (August 26, 2005)
What is economic development? Does economic development bring about a society where everyone has the right to a decent life or does it only give wealth to a small percentage of the population? A recent UN report on "The World Social Situation: The Inequality Predicament" focuses on the "persistent and deepening inequality" in the world. This condition makes it more difficult for poor countries to achieve the Millennium Development Goals. (Inter Press Service)
Bad to the Last Drop (August 1, 2005)
While over 1 billion people worldwide lack reliable access to safe drinking water, people in rich countries spend astronomical amounts of money on bottled water, which they could not distinguish from tap water if they tried. Ironically, only $11 billion would pay for clean water and sanitation for everybody on the planet, a figure which represents less than a quarter of global annual spending on bottled water. (New York Times)
