A recent news item revealed a fact that strikes me as a moral obscenity. That was the Oxfam report Working for the Few: Political Capture and Income Inequality that found the richest 85 people in the world own as much as the poorest three and a half billion. That's 85 individuals whose resources equal those of half of humanity. If you broaden things a bit, the top 1% own 65 times as much as the bottom half, those same three and a half billion. In the United States, 95% of the post-crash growth after 2009 has gone to the top 1%, while 90 percent of the population has gotten poorer. Income inequality has grown faster--much faster--in the United States than any of the other countries. But it is not alone in the general trend. From 1980 to 2012, the richest one percent has increased its share of the wealth in 26 of 28 countries for which complete statistics are available.
By going to the link above you can learn the whole story in 32 pages. Or you can open the summary version and get the full outline in 6 pages. I highly recommend it; it's a real eye-opener. Oxfam has been fighting world hunger and poverty since it was formed as the Oxford Famine Relief Committee during World War II in 1942. It's now a world wide non-governmental organization.
The subtitle encapsulates a prime finding of the study. It raises the warning that by virtue of their wealth and influence over political systems around the world, this tiny minority could very well lock in a perpetual dynamic of increasing wealth for those at the top and increasing want for all or most below.
To avert this, it calls on governments and the wealthiest to support open and progressive taxation of wealth and income and for governments to ensure education, health care and social protection for their people. The report asks the wealthy to commit to having their companies pay a living wage, to not bending political processes to their narrow selfish ends, to not evading taxes, and to challenging other wealthy people to do the same.
The idea that we are a species that allows 85 single individuals to engorge themselves on as much as half the global population while a couple of billion live in abject poverty is morally indefensible, and frankly, sickening. One percent is worth $110 trillion. Fifty percent is worth $2 trillion. Even a modestly augmented amount of redistribution through services and a decent wage would provide plenty to eliminate desperate want on a global scale while still affording a luxurious lifestyle to the affluent. It's time to begin making that a reality.
Showing posts with label Inequality. Show all posts
Showing posts with label Inequality. Show all posts
Tuesday, February 4, 2014
Sunday, August 19, 2012
Good Read on Economic Solutions
Paul Krugman teaches economics at Princeton University and won the 2008 Nobel Prize in Economics for his work on international trade and production. He also writes a regular column for the New York Times. I recently read his book The Conscience of a Liberal. Using words and concepts a layperson can understand, this work provides a clear understanding of the processes that have put the American middle class into increasingly difficult straits. I recommend it to anyone who is concerned about growing the economy and reversing these trends.
Given the title, Krugman's work was not exactly what I expected it to be. I envisioned a philosophical examination of Krugman's idea of what a liberal is, or perhaps a personal epiphany of how he came to his perspectives. While these topics are implicit in the book, it is primarily a no-nonsense, nuts and bolts explication of trends over the past thirty-plus years that have resulted in an ever-growing concentration of wealth in fewer people at the top and a commensurately ever-diminishing level of services, income and consequently, opportunities for everyone else. The author backs his conclusions up with plenty of data. He wrote the hardcover edition in 2007, before the recent crash, but the paperback edition has a new introduction written in 2009 that takes it into account. Regardless, the points and facts are still valid and on point.
Central to Krugman's point is that from the Great Depression of the 1930s through a period of over 40 years, government policy intentionally favored and fostered an economy that spread benefits widely throughout the labor force. He starts out with a survey of "The Way We Were," an economic picture of America of the 1950s and 1960s, a time when there were far fewer mega rich and an enormous and growing middle class of shared prosperity. He calls this period of lessening inequality and widespread improvement in the financial well-being of the broad majority the "Great Compression."
Krugman shows how benefits like Social Security, universal education, the public university systems, the GI Bill and Medicare, spending and research programs such as the interstate highway system and the space program, a government stance that protected the union movement, and a tax policy that funded these initiatives and encouraged companies to invest broadly in their people while dissuading the paying of astronomical sums to individuals worked to the end of a society that produced a rising tide that raised all boats.
As a consummate international economist, Krugman is specifically able to refute the contention that simple market forces alone have caused the growing concentration of wealth of recent decades by comparing the American experience to those of other countries who have followed different policies than the U.S. such as Germany and Canada. Such countries have retained high union membership, broad-based income gains shared by all income levels levels within the labor force and a superior level of services than here.
Krugman next turns to a survey of the growth of extreme conservatism, its policy victories and their pernicious effects on society as a whole as it enormously aggrandizes a few while progressively pauperizing the rest. In his section "Confronting Inequality" he administers his prescriptions for reversing these lamentable trends. Among these are restoring greater progressivity to the income tax, taxing capital gains like regular income, raising the minimum wage (it's still far below where it was in 1955 in inflation-adjusted dollars), guaranteeing universal health care, providing far greater assistance to education and college affordability, making much greater investment in social and tangible assets, and returning to union-friendly policies.
Given the title, Krugman's work was not exactly what I expected it to be. I envisioned a philosophical examination of Krugman's idea of what a liberal is, or perhaps a personal epiphany of how he came to his perspectives. While these topics are implicit in the book, it is primarily a no-nonsense, nuts and bolts explication of trends over the past thirty-plus years that have resulted in an ever-growing concentration of wealth in fewer people at the top and a commensurately ever-diminishing level of services, income and consequently, opportunities for everyone else. The author backs his conclusions up with plenty of data. He wrote the hardcover edition in 2007, before the recent crash, but the paperback edition has a new introduction written in 2009 that takes it into account. Regardless, the points and facts are still valid and on point.
Central to Krugman's point is that from the Great Depression of the 1930s through a period of over 40 years, government policy intentionally favored and fostered an economy that spread benefits widely throughout the labor force. He starts out with a survey of "The Way We Were," an economic picture of America of the 1950s and 1960s, a time when there were far fewer mega rich and an enormous and growing middle class of shared prosperity. He calls this period of lessening inequality and widespread improvement in the financial well-being of the broad majority the "Great Compression."
Krugman shows how benefits like Social Security, universal education, the public university systems, the GI Bill and Medicare, spending and research programs such as the interstate highway system and the space program, a government stance that protected the union movement, and a tax policy that funded these initiatives and encouraged companies to invest broadly in their people while dissuading the paying of astronomical sums to individuals worked to the end of a society that produced a rising tide that raised all boats.
As a consummate international economist, Krugman is specifically able to refute the contention that simple market forces alone have caused the growing concentration of wealth of recent decades by comparing the American experience to those of other countries who have followed different policies than the U.S. such as Germany and Canada. Such countries have retained high union membership, broad-based income gains shared by all income levels levels within the labor force and a superior level of services than here.
Krugman next turns to a survey of the growth of extreme conservatism, its policy victories and their pernicious effects on society as a whole as it enormously aggrandizes a few while progressively pauperizing the rest. In his section "Confronting Inequality" he administers his prescriptions for reversing these lamentable trends. Among these are restoring greater progressivity to the income tax, taxing capital gains like regular income, raising the minimum wage (it's still far below where it was in 1955 in inflation-adjusted dollars), guaranteeing universal health care, providing far greater assistance to education and college affordability, making much greater investment in social and tangible assets, and returning to union-friendly policies.
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