Inequality and the Inevitable Collapse
Weekend Edition April 18-20, 2014
Sharing: The Common-sense Solution
Inequality and the Inevitable Collapse
by GRAHAM PEEBLES
Depending on who you listen to and how it is defined, worldwide income and wealth inequality is either more acute than it has ever been, or the gap between the rich and the rest is narrowing. The numbers may be distorted by conflicting statistics but what is indisputable is the shadow of extreme poverty that billions are living under, the economic induced anxiety millions more face every day, and the fact that the rich continue to get richer. Of the 7.2 billion people in the world, around half are living on less than $2.00 a day ̶ that’s the official barrier to the land of poverty set by the World Bank. Most of these people are to be found in the slums or villages of India, China, and the shantytowns and rural settlements of Sub-Saharan Africa, where 48% of the population live on less than $1.25 a day. (World Bank 2010)
Inequality, Noam Chomsky says, “has reached historic heights”, heights revealed by Oxfam in a recent report (using data from the Credit Suisse’s 2013 Global Wealth Report) by some startlingly unequal ‘facts’: “Almost half of the world’s wealth is now owned by just one per cent of the population. The wealth of the one per cent richest people in the world amounts to $110 trillion. That’s 65 times the total wealth of the bottom half of the world’s population. The bottom half of the world’s population (3.6 billion) owns the same as the richest 85 people in the world.” And the Washington Post report Credit Suisse’s findings that “the lower half of the global population possesses barely 1% of global wealth while the richest 10% of adults own 86% of all wealth, and the top 1% account for 46% of the total.” And in the Land of the Free, where anyone can supposedly become a zillionaire, income and wealth inequality is the most acute of any industrialised nation and the highest it’s been since 1928. The median wage for a working-man in the US today, according to Nobel Prize-winning economist Joseph Steiglitz “is below its level in 1989”. But not to worry, the top 1% in America are doing just fine: Oxfam found that “the wealthiest one per cent captured 95 per cent of post-financial crisis (2009 onwards) growth, while the bottom 90 per cent became poorer.” To be born poor in the US is to remain poor: upward mobility remains virtually non-existent and ‘The American Dream’ little more than a frothy Hollywood fantasy.
The Organisation for Economic Co-operation and Development (OECD) makes clear its view n a comprehensive report pointing to the stark differences existing in income within OECD countries; “it reaches 10 to 1 in Italy, Japan, Korea, and the United Kingdom,” leaps to “around 14 to 1 in Israel, Turkey, and the United States and “27 to 1 in Mexico and Chile.” It also lists America as having the highest poverty rate of all OECD countries (aside from Turkey), and slumbering near the bottom in terms of social justice.
Income imbalance is only part of the divisive socially unjust problem of inequality.
Wealth inequality is the other half of the puzzle, and it’s constantly growing, as French economist Thomas Piketty makes clear in his new book Capital and the 21st Century. “In societies where the rate of return on capital outstrips economic growth, wealth inequality ineluctably rises. Once constituted, capital reproduces itself faster than economic output increases.” (New Statesman) Accelerating the social chasm that is wealth inequality, making it more difficult month on month, year on year to close the wealth gap and reduce the inequity. “In Europe the wealthiest 10% own 60 per cent of wealth, in the US its 70 per cent.” Piketty warns that if wealth inequality is allowed to grow, the consequences are “potentially terrifying”.
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http://www.counterpunch.org/2014/04/18/inequality-and-the-inevitable-collapse/
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