Read below and see if the numbers don’t startle you. How can you have a functioning democracy with even a handful of these people in your country? Each one has more money than the total budget of most American states and good number of small nations. How do deal with that kind of concentration of economic power?
We have lived in a nation that has created more and more people like these. During this time, wages have stagnated or declined, the poor have multiplied and jobs are harder to find while education spirals in costs. What right do these people have to call themselves job creators when the evidence shows that it is a vibrant middle class supported by government policy that creates and maintains good jobs?
Our democracy is not threatened from abroad. It is threatened by an incredible wall of political money which makes the middle class and poor inconsequential in the making of policy. That’s not democracy.
The World’s 85 Richest People Own as Much as the 3.5 Billion Poorest | TIME.com
The world’s 85 richest individuals now own as much as the poorest half of the 7 billion global population, according to a report released by Oxfam on Monday.
The leading anti-poverty charity called on the global economic elite gathering in Davos this week for the World Economic Forum to “counter the growing tide of inequality” and prevent a static future in which only the rich have access to the best education and healthcare.
“It is staggering that in the 21st century, half of the world’s population own no more than a tiny elite whose numbers could all sit comfortably in a single train carriage,” said Winnie Byanyima, Oxfam Executive Director.
From the web site, P.A.P. Blog.
Rest assured: this post is going to be more nuanced than the image above. As usual, what I want to do here is look at a possible cause of increasing income inequality, namely the relative shares of labor and capital income. Your labor income is your wage, your pension, your bonus, your company health insurance etc. Most people have a labor income. You only have capital income if you receive dividend payments, capital gains, interest payments on savings etc.
During the last decades, the share of labor compensation in total national income has declined, and this has been a global phenomenon, occurring in most countries:
Can we blame this decline for the increase in income inequality during the same period? Only in part, I think, because there has also been a divergence within labor in the sense that some people, mostly high earners, have seen their labor income rise much faster than others. Income inequality is indeed, to some extent, wage inequality. The growth of the finance sector, where people are well-paid, is part of the explanation for the increasing wage inequality, at least in some countries. Tax policy, declining bargaining power among the low earners and wage competition from poorer countries – again affecting mainly low-end workers – may be other explanations for rising wage inequality, also depending on the country (unionization rates, for example, haven’t evolved in the same manner everywhere).
But I guess it’s true that not all of income inequality is wage inequality and that incomes from capital, such as profits, dividends, stock options etc. also explain something. Capital income is, compared to labor income, unevenly distributed across a population, and concentrated among the wealthy. A rise in capital income leads therefore to a rise in income inequality. Part of this is just arithmetical: the flip-side of a lower share of national income coming from labor is a higher share of income coming from capital. Capital income needn’t be higher in absolute terms in order to get a larger share. If there’s widespread wage stagnation – perhaps due to international wage competition, trade and outsourcing – then capital income may rise relatively, if not absolutely. However, in some countries we also see an absolute rise of capital income.