Rising inequality – the main risk facing the world

inequality, World Economic Forum, Davos 2017

After Brexit and the outcome of the US presidential election it’s essential to deal with the huge problem of inequality. World leaders are voicing their concern at The World Economic Forum. The Economist‘s economics editor, Zanny Minton Beddoes was of that opinion already four years ago. In this short video she explains why rising inequality around the world is a major headache:

To keep on ignoring this enormous problem facing the world will lead to more Brexits and Trumps. Do we really want a world  run by populist autocrats where human rights, freedom of speech and other fundamental rights that we take for granted are being diluted? Or worse abolished. A Brave New World like Aldouxs Huxley imagined it. Have personally written about the problem of inequality and what it will lead to since I started this blog in 2009. And now we see  the results of politicians ignorning it in order to keep power. Unless the world wants more demagogues in power poiliticians worldwide need to wake up and take action. As far as a capitalist like me is concerned socialism is a better option than fascism. Never thought fascism would be on the rise again after Hitler. But it is.

Top leaders believe it's essential to look for ways to improve equality
Top leaders believe it’s essential to look for ways to improve equality

Will democracy decline?

Inequality has widened for decades in two thirds of the rich countries and many emerging economies, including India and China. The global crisis in 2008 made it even more of a problem, not least because of the austerity measures being implemented. The Davos meeting this year included this article focusing on fixing inequality.

It’s in times like these that democracy declines and autocrats get the opportunity to grab power. Last year notably in the US and the Philippines. Theresa May, Prime Minister of the UK, featured in the main picture. has contributed to increasing  the inequality that resulted in Brexit. She is now faced with handling Britain leaving the EU and seems to believe that grovelling to Trump  is the way forward. It’s time for her and politicians globally to stop focusing on their own interest and make sure inequality is reduced. If not, we will have more  demagogues in power . Former British Prime Minister Sir Winston Churchill would be appaled if he was knew a British PM was grovelling to a demagogue. If he had grovelled to Hitler Germany would have won World War II.

Do you want a world run like Russia today where stalinism is alive and people are, again, afraid of knocks on the door in the middle of the night? Uncle Joe has been ten feet under since 1953 but his ideas of how to run a country have been implemented again. If Russia has its way Eastern Europe will again be dependent on them and a new Iron Curtain will be raised. If the new US president scraps NATO and let’s Putin have his way in Europe that will definitely happen. We will, in other words, switch time back to the end of World War II instead of moving ahead and keep on developing liberal democracy. Bertrand Russell wrote already in the 50s that he hoped liberal democracy would survive. But will it? Or will the world, like throughout history, after a time  of democracy move into dictatorships with autocrats in charge? Hopefully not, but if inequality is not dealt with we will leave liberal democracy behind.

Do you agree that rising inequality is the main risk facing our world? If so, what do you think should be done to stop income disparity getting completely out of hand? Should austerity be abolished and economies stimulated to make them grow and hence have a positive impact on inequality? What’s your suggestion? How can we make life better for more people so they spend money and hence improve the world economy? Or are you of the opinion that rising inequality is a good thing and that the leaders telling the WEF it’s the main problem facing the world are wrong? What will happen if inequality is not diminished? Will we have more demagogues in power that will increase inequality? Or maybe you believe that it’s better to leave democracy behind and have strong men in charge?

Video: EconomistMagazine Picture: World Economic Forum + Number 10

95 thoughts on “Rising inequality – the main risk facing the world

  1. Trump is terrifying as he rolls back consumer protections and begins to dismantle Dodd-Frank, the law that regulates the financial institutions whose reckless investment behavior caused a global meltdown in 2008. He has promised to roll back taxes on the very rich and that will cause even more income inequality. There is a movement, as you mention, toward more authoritarian rule around the world. Are we seeing the 1930's repeated?

    1. Not surprised we agree completely, Jeannette. He will cause minimum another global meltdown or worse a world war. He is paving the way for kleptocracy which will benefit him. Hopefully we will now not revert to authoritarian leadership all over the world. But it may happen. His followers believe all the lies he says and have stopped reaading quality news. Sigh…

  2. I am terrified by the rising inequalities in the world, Catarina. It really scares me that the Trump administration is rolling back some of the human rights that were fought for by so many. I can only hope that the public protests will help with a pushback. I am very grateful to be Canadian, where human rights are respected and alive.

  3. There are many factors stimulating the rising inequality, this may sound harsh but I personally believe spoon feeding is not the solution. I say so coz we back here in India had spoon feeding system called reservations for backward but that affects the one's who are eligible.

    1. The main reason voters in the West, not in the developing world, are unhappy is robber capitalism i.e. neoliberal economics. The vast majority of Americans have not had a raise in salary since the 1970's. They are angry and voted for Trump. Now the problem is spreading to Europe because of neoliberalism. The country where the common man, including the middle class, has lost out most is the UK. Not surprisingly they voted for Brexit. In India the majority of people have benefitted from globalisation. But if the rest of the world become authoritarian it will not be much of a help for your country because the phenomena will spread i.e. most likely you will end up becoming a dictatorship as well. By the way do you realize that there are US CEOs who earn thousands of times more than the lowest paid person in the organisation. At the same time the lowest paid people can no longer survive on their salary but need to have several jobs to pay for housing and food. Hence Trump is in the White House.

  4. I think the push back on globalization, and the resurgence of isolation, combined with the decrease in democracy are a typical reaction to change. Change is a threat to people, especially to those in charge.
    When ever there is a change to the old ways, there is a natural reaction to go against them. If you look at history, you always see this. When a new US President is elected, there is usually a mid-term election in congress that goes with the party out of power.
    People do not realize that during the Renaissance, the rebirth of knowledge, more people were burnt at the stake as witches compared to the middle and dark ages.
    Our progress, in government, wages, environment is literally two steps forward, one step back. All we can hope for is there is not too much damage down when we take that step backwards.

    1. Interesting analysis considering that the majority of Americans have not had a raise in salary since the 70s. A multitude of Americans actually need two or more jobs to be able to pay basics. How can that be called progress in wages?

  5. So many factors feed into rising inequality that it's hard to pinpoint what to do to make the necessary headway. Considering Trump is now the leader of the free world, I have less hope than ever.

  6. There is much uncertainty with Brexit and Donald Trump as the new US President. Already plans are being made surrounding immigration into the US.

    The gap between rich and poor is widening by the day. Even here in the U.K, many are reliant on food banks.

    You mentioned the ruler Stalin whom I learnt of many years ago via history class. I wondered how on earth so many were willing to follow this man.

    1. People did not follow Stalin out of free will. They had no choice if they wanted to stay alive. Stalin was a dictator just like Putin is today. Putin's grandfather was actually Stalin's cook. Stalin had millions of people killed. Putin can't go as far today as Stalin could until he died in 1953. Have a feeling Russia's current dictator would have loved to be even more like Stalin.

  7. Catarina, You’ve inspired me to gain knowledge about the global economy.I’m trying to find information that includes a variety of viewpoints. I’m still absorbing and processing what I ‘ve found. I try to look at what makes sense. What doesn’t make sense to me is the world has made tremendous gains in medicine and technology. Such great minds at work, with everything but the economy. There’s a part of me that doesn’t buy it, I believe these great minds know exactly what to do, they don’t want the change. I feel the same way about politicians, they don’t want the changes they know exactly how to implement because if the world ran smoothly, the politicians would be out of work.

    1. Thank you, Pamela. The world economy is rigged by neoliberalism i.e. theories of economics out of The University of Chicago. Nobel Prizer winning economists Joseph Stiglitz and Paul Krugman calls neoliberalism American robber capitalism because it enables top executives to get massive pay packages at the expense of everybody else in the organisations. That's why a lot of middle class Americans have not had a pay rise since the mid 70s. Neoliberalism crashed the world economy in 2008 but it's still being implemented because it benefits the top 1% of people in the world. Things would most likely already have changed if it wasn't for US politicians being dependent on donations from corporate America to get elected. In resurn for the donations they do what the donors want them to do.

      1. “Things would most likely already have changed if it wasn’t for US politicians being dependent on donations from corporate America to get elected. In resurn for the donations they do what the donors want them to do”.

        Catarina you said it all…that’s really the bottom line. It makes me wonder, who is really in charge, “the almighty dollar” it has little to do with the , “the good of the people”.

        1. Yes unfortunately, Pamela. And what's worse the US forced the majority of countries in the world to implement globalisation and neoliberal economics through the IMF. That's why the world economy fell like dominoes when Lehman Brothers collapsed.

  8. This is something I’ve been thinking about while watching the news lately. Throughout history, it’s never benefited anyone in the long term to be alone in the upper echelons on society and wealth. It usually leads to beheadings and all sorts of unpleasantness. It seems like the whole society does better when equality prevails. The question is how to make that happen?

    1. Maybe, Meredith. Equality was actually increasing from the end of World War II to the 70s. Then inequality started, again. Pity since people who are used to equality will not accept inequality in the long run.

  9. Catarina, I’ve been concerned about the rising inequality for some time and have stated more than once that a revolution is coming. To compare the situation today to 1913 is even more frightening than my own thoughts which assumed small unrests caused by those less fortunate. If history is any indicator, we are doomed to repeat our mistakes.

    1. Yes, it's really an issue that needs to be addressed, Kire. The main problem is neoliberalism that comes out of University of Chicago. Remember Milton Friedman? His version of economics have been tried for half a century and never worked anywhere. His theories even crashed the world economy in 2008. But despite that they are still being implemented because of greedy upstarts in, mainly corporate America.

  10. There are lots of problems all of have to cope with today but inequality seems to be a major one. It worries me that the younger generation will have it even tougher than us in spite of them being educated and with professional careers. I really don’t know how this problem can be sorted.

  11. I think one of the issues why inequality in industrial countries is rising, is a lack of competition. When the world had communism, workers had to be paid a fair price for their labor. There was always a threat of communalism expansion if workers were not paid a fair price for their labor. That threat is now gone, so workers are at the mercy of capitalists who now look only at profits.

    1. Thank you for giving us your thoughts on inequality, William. It's not capitilism according to Adam Smith but American robber capitalism a lá Milton Friedman that's causing the problem. Adam Smith must be turning in his grave.

  12. Catarina,

    I had not heard that the richest 1 percent in the world would soon own as much as the remaining 99%. It is painfully obvious that the gap between the haves and have-nots is increasing. I have no answers. The outlook is dismal to me. We can only hope that our upcoming election will change the landscape of politics here in the US but I don’t think anyone is optimistic about that.
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    1. It's unbelievable, isn't it, Sherryl. The ideas behind it all are straight out of University of Chicago and Milton Friedman. His version of economics have been tried for half a century and never worked anywhere. Doing things his way even caused the global economic crisis in 2008. But despite that his ideas are being implemented. Not least because they suit big corporate donors in the US. And since your politicians can't get elected without such donations, I doubt there's much hope for a change in your country.

  13. That is scary that analysis shows 2013 looking very similar to the year 1913. I can see the gap widening and it is a growing problem. We need a strong middle class, and if that disappears, many problems will follow.

    1. Glad you agree, Erica. It's lamentable that economics a lá Milton Friedman is being implemented world wide. The result is that the mega rich earn at the expense of everybody else.

  14. Gosh, I see the gap widening between the haves and have-nots every day. It makes for an uneasy feeling all around. Providing a good education and meaningful work is truly the key to narrowing this growing gap. To me, it’s heartbreaking to see the hunger that exists with young children in these have-nots families. I not sure how it can be addressed, but it sure does need to be and soon. Otherwise, I fear for the next generation.

  15. An interesting (re)post, Catarina, especially coupled with last week's one and the reference to Charles Emmerson's Eve of Disaster piece. It's certainly food for thought!

    There's little question that inequality is a serious problem and it's good to see world leaders are talking about this, even if they are as much a part of the problem as the richest among us – look at the fees that (ex) politicians command for speaking, etc., apart from the rampant corruption of the political classes in many countries, such as my own.

    The question, though, is what feasibly can be done about it. Raising taxes doesn't work – people are too mobile and changing countries is quick. Even with those who can't easily move, raising taxes yields no significant benefits anyway as other means can be found to reduce the tax burden. It's also counter-productive insofar as it tends to lead to lost jobs.

    What is clear is that small businesses around the world are the main creators of new jobs, so perhaps governments should look to reducing taxes and red tape and encouraging small businesses to be formed and to grow.

    A lower overall tax base that people see as fair would mean less tax avoidance or evasion and should ultimately raise the revenue realised while encouraging job creation.

    Perhaps this is worth a try as it's clear the current approach isn't working.

    1. The root of the problem is, as you know, Guy neoliberalism. It has been tried for half a century and never worked anywhere. That kind of economic policies even crashed the world economy in 2008. One thing that's really interesting is that all billionaires and super rich people I know are of the opinion that taxes for the mega rich should be raised. It's, for some reason, the middle classes that are against doing so. Not least in the US where they still believe in the American dream. Agree with you that taxes should be reduced for SME's. Would be best if that was done on a global scale. Know that's unlikely unfortunately. By the way, the problem, as you know, started with globalisation that benefit multinationals that sometimes are more powerful than countries. And because the US supreme court considers them to be a person it's difficult to stop them from doing what they are doing.

  16. Interesting I was just listening to an radio program talking about the disparity of wages in San Francisco, making the city unlikeable to many. Who work there. With the high incidence of wealthy high tech firms now located there, the proposal was that that supposed low paid jobs- janitors etc. did not have to be so, and if the wages for unskilled work were sufficiently raised then it would go at least partway to solving the problem. I of course agreed, and do not see the need , when their is abundant wealth available for it not to be spread about. In short 'share the wealth!'
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    1. Glad you agree, AK. But it's the US concept of take from the poor and give to the rich that has caused this alarming problem in the world. Milton Friedman really managed to cause problems. And the worst part about it is that his policies don't work but are, despite that, being implemented.

  17. There is widespread acknowledgement of the issue of inequality, and though some might argue that it isn't the most important economic issue depending on your locale and culture. I think the disparity of opinion is wider when it comes to solutions to the problem…because that gets all tangled up in politics. And that's never a good thing:)

  18. Another thought-provoking post Catarina. I don’t know if rising inequality is the world’s biggest problem, but it is a significant one. Not only is it inherently not right in my opinion, the continuing gap leads to instability and dictator-like control. It’s interesting that the economists are concerned about it.

    1. Donna, it's not only economists but top world leaders in politics as well that consider it to be the worst problem facing the world. Almost all leaders that count in the world attend the World Economic Forum in Davos.

  19. Completely agree with you on this one Caterina. The whole idea of “trickle down” economics should be now be thoroughly discredited, because it is just not trickling on down. I think one step that would help address this is if tax policy was geared to benefiting businesses that create jobs and that invest their earnings in the growth of their business rather than rewarding executives and shareholders.

    1. It's interesting that Milton Friedman's ideas that are at the root of this problem has been tried all over the world for half a centtury and never worked anywhere. isn't it Ken. But the supreme court decision that a corporation = a person makes it very difficult to solve this issue. US politicians need to get donations from companies in order to get elected. Unfortunately some such coroporations are run by people who are upstarts thanks to Milton Friedman's policies.

  20. There are so many problems in the world but inequality is huge. I wish that nations could really get together and agree on solutions but they all have their own agendas fueled by politics and re-election, etc. In the US, only the rich get richer, generally. Entrepreneurs who aren’t dependent upon employers setting salaries can earn more with careful planning and hard work.

    1. Absolutely, Beth. But don't forget that it's impossible to earn as much as the top 1% even if you are an entrepreneur that plan and work hard. The system is rigged against the 99%.

        1. The point I'm making is that the development since the 70s is completely wrong, Beth. It was Ronald Reagan and Margaret Thatcher that started implementing Milton Friedman's economics because it suited their political ambitions. They completely ignored the fact that Fridman's ideas had never worked anywhere. And still haven't. What they started has enabled one percent of the population of the planet to earn fortunes at the expense of the remaining 99%. Do we really have our destiny in our own hands today? When you and I were young we could decide what we wanted to do and achive it. We had our destiny in our own hands. For the young generation today it's different. An abundance of young people from the 99% end up with just their student loans when they graduate from university. The children of the 1% on the other hand can be mediocre and will still end up with top jobs earning a fortune. The sooner this development is reversed to where it was before Reagan and Thatcher started changing the world, the better.

  21. Catarina, as always you touch on the bigger issues, the ones with no easy answers. The 1% don’t really have to do much to get richer, they can basically put their money into safe investments and still make a fortune. The average person doesn’t have the resource to compete with that and the poor of course are right outside the circle. So yes, there is rising inequality – the rich get richer, the middle class is at a standstill and the poor are fighting to survive. I really don’t see how the trend can be reversed and that can have other serious problems besides the economic ones.

  22. Until we get money out of politics I doubt this will ever be solved. There was a documentary made around 2012. One of the inherent problem, likely across the world, is the corruption that goes on between some of the uber wealthy, the lobbyists and politicians. If there is a law they want passed, they pay for it. Often it is laws that prevent them from paying higher taxes and for people like me, hard working and regular citizens, footing the bill for what they paid to get out of. I sure would love someone to have an answer instead of continuing to look at the crystal of problems causing it. In the meantime rising inequality continues throughout the world
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    1. That's unfortunately true, Patricia. Not least in the US since the Supreme Court ruled that a corporation = a person. One of the most interesting aspects is that it's not the wealthy that defend the system but the middle class. They still, wrongly, are under the impression they can make it through hard work.

  23. True Kelly. The WEF rated inequality as the main risk followed by sovereign debt, lack of natural resources and so forth. So all the main issues were covered but inequality was still regarded as the most problematic.

  24. UN ILO report : Global Employment Trends 2013: # of jobless people worldwide increase by 4,2 million in 2012 to 197 million — nearly 13% of those without employment were age 24 and under. and at Davos– Oxfam International states " world's richest earned $240 billion in 2012…and from tax havens to weak employment laws the richest benefit from a global economic system that works in their favor. " So we have the wealthy accumulating more wealth for the wealthy on the backs of everyone else. Oxfam estimates that tax havens hold as much as $32 trillion or third of all worldwide wealth and that closing them could net $189 billion in additional tax revenues.

  25. Well, yes, Catarina. (I believe the first of your articles I read was about population shifts to the city which touched on that topic.) By way of metaphor: "The haves are growing arithmetically, the have-nots are growing geometrically." SF

    The efforts to raise people from population is a good thing. Then there are the unwanted consequences: What I am working on now is when people rise from poverty, the consumption goes up. This results in greater competition for what is there while taking away from those who have less.

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  26. Inequality and economic growth. It's very simple: If the median APC exceeds 1.0, then slow growth or recession are a mathmatical certainty. Much of the current economic stagnation and jobless recovery is a direct result of fiscal policies from 2001 to 2009 that re-distributed wealth and income from the bottom to the top. Also read Joe Siglitz article in NY Times, Jan 21, 2013. Tim Jochim

  27. I read recently that income inequality in the US has reached its highest level since the Great Depression–93% of the income is made by 1% of the people. Quite startling really. It should be distributed more evenly, though in a perfect world I don't think it would be completely flat. Income should still reflect the amount of work you put in and the majority of people simply aren't willing to work hard.

    Still, it shouldn't be this unequal. Income inequality is a big drag on growth–the IMF did a study on the question in April of 2011, In their words income equality matters if a country is to sustain long term economic growth: "We find that longer growth spells are robustly associated with more equality in the income
    distribution. For example, closing, say, half the inequality gap between Latin America and
    emerging Asia would, according to our central estimates, more than double the expected
    duration of a growth spell. Inequality typically changes only slowly, but a number of
    countries in our sample have experienced improvements in income distribution of this
    magnitude in the course of a growth spell. Inequality still matters, moreover, even when
    other determinants of growth duration—external shocks, initial income, institutional quality,
    openness to trade, and macroeconomic stability—are taken into account. "
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  28. Wealth is built by human minds agreeing that technology is worth more than gold, silver, oil, and land… A culture that "shares", including mind-share with trust in each other is the wealth building ingredient. WEF opinions are just "lucky" people that happen to make money in this world, being at the right place at the right time. The funding to feed the poor communities comes from the middle class, managed by the elite. More intelligent policy would be to OPEN up all the boarders and governments should talk directly to each other rather than going through third parties. e.g. U.S. govt talks through Switzerland when policy is being discussed with Iran. It was international news when the U.S. Navy talked to a crew of Iran? Why not let Americans freely go to Iran, N. Korea, Suddan, and other hot-spots. I have attended N. Korea discussions 2007 where the State dept. showed up, but they did NOT talk the language of N. Korea people visiting Seattle WA. Why? Who is buying all the low priced Iranian oil? Let me take the risk to go where I want with agreement not to rescue me – should I be kidnapped.

  29. Its hard to say what the biggest problem facing our world is today because they're are so many. Obviously, this is one of the biggest items of concern on the plate for world leaders but I'm guessing everyone has different opinions and solution suggestions on it. The problem is that all different countries can't get on the same page with what the largest problem is so efforts are dispersed rather than focused.
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  30. Well despite the grim nature of the post, in some ways I was pleased to see that economists are actually concerned. It gives one hope that perhaps politicians might think it beneficial to change the trend towards a growing gap. It certainly is not going that way in the UK though with austerity measures in abundance. Interesting take on the problem Catarina. Thank you
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  31. As always a very interesting article Catarina. There has always been inequality but the crisis has widen it and it I believe is also occurring in my country. We talk about the 2 speed economy and the politicians talk up how well our economy is but that is due to our resources boom. For many the gap between those struggling and those doing well is widening. Politicians will not act as unfortunately they make decisions based on political interests rather than what is best for the people. This is highlighted by taxes they bought in due to a small third party that is keeping them in government.

  32. The common denominator seems to be: government. My sense is, at least in the USA, is that regardless of political preference, our government and by reasoning our representatives, are corrupt to their core. We found that out 2 years ago when it was found, on all sides of our political spectrum, our own elected government representatives, were engaging in insider trading – talking about the rich getting richer. If there is this common denominator holding back a more equal balance in wealth, until we enact things like term limits, eliminate a pension for life for serving just one term, hold our representatives accountable to results, then NOTHING changes. And then nothing will change because as a society US citizens have become complacent in some ways.

    The bible for reference says, there will always be poor among you. If that is true, they of course, even if we close the gap, there will be poor. As someone becomes richer, let's say a garbage pickup employee, and leaves that "post", then certainly someone has to come along and fill that empty post.

    For sure it is a complex situation and likely not solved in my lifetime.
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  33. I very much agree. The gap is widening between the haves and have nots. Education and meaningful job creation is the true key to narrowing this growing gap. The saddest part of this is the hunger that exists with poor young children. I not sure how all this can be addressed but it does need to be addressed and sooner rather then later. 🙂
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  34. Why does the West think that it's own form of "democracy" is the only form of viable Democracy? A thinking person, if he/she examines the situation with an un-biased view, will put together 2-and-2 and see that the western type of democracy has resulted in there being classes of society – those who have plenty and those who have little, thereby bringing about inequality. Those who have plenty can enjoy nutritious food, medicine, and material plenty. Those who have little enjoy hunger, little or no medical care, and hardly be able to possess the basic necessities of life – shelter, security, etc.

    1. Amin, exporting US democracy the way America has done is wrong and should never have been attempted. All countries should be allowed to develop at their own pace. However, you have inequality all over the world, including in the Middle East. Rich people there have everything and poor people nothing. And the same applies to Africa, Asia, Latin America and even North Korea.

  35. Higher education needs to be made more affordable, and the quality of education needs to improve as well. People need to ask what is education for and realize many programs often function on traditional notions that do not serve the needs to today's students. Anything done to help business will not be successful until society can do more to take care of itself. Hegemonic practices are the root cause of all this.
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    1. Agree with you Jeri. Another thing is that manufacturing needs to move back to the West. All countries in the world have citizens with capacities ranging from geniuses to imbeciles. What are the ones with a lesser IQ going to do? Higher education is not the solution for them:-)

  36. Fully agree together with the destruction of jobs through technology. Jeremy Rifkin was right in The End of Work. A few years ago a Russian journalist (sorry I forgot his name) said that with the present trend in poverty, the time was ripe for a Communist revolution and he hoped there was not a fat bearded German working at the British Library and a Russian emigré in Geneva ready to hop on a train and start the revolution.

  37. Catarina, As usual, you've cast a light on a very current topic. I find the rising inequality here in the U.S. to be particularly disturbing. The middle class is shrinking and there are no signs that the reckless spending by our government will be curtailed. We seem to be set on the same course for another four years.
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  38. Catarina — the income inequality is quite noticeable in the U.S., particularly with Republicans in charge of the House of Representatives where money bills originate. The very rich get favored in tax treatment at the expense of the middle class. The CEOs of companies here make huge salaries and other perks and find tax loopholes to keep most of it. The middle and lower economic classes don't have access to those loopholes. As billionaire businessman Warren Buffet has observed, his tax rate is lower than his secretary's.
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    1. Agree with you completely Jeannette. And the same is happening in the whole world. It's all part of the philosphy that the Republicans in the House are pro. It's been exported all over the world and has made 2013 similar to 1913 on the cusp of World War I. It's just a question of where in the world there is a spark and events we would rather avoid will start snowballing. Unless of course, politicians get their act together and do something to alieviate the situation.

  39. Catarina,

    Girl I have to make sure that I am fully awake before I read your posts, they are always so deep. This time I am at a loss really, I believe that inequality is a problem. I would prefer that instead of the rise of autocrats we would see a rise in civil fighting for equality. I hope that people will stand up for themselves instead of allowing themselves to be further controlled, I fear the later may be the case. As for a solution, this one I don't have a clue to. I usually have some thoughts on what can be done or at least tried about things, haven't got a clue. I don't think we have hit critical mass yet, but if is coming all around the world. Should be something when we hit that mass. I suspect we will turn against one another before we turn against our governments, we are showing signs of us turning against one another now. I think possible because we don't know how to attack the people (government, rich) that we are really upset with.

    We will see,
    Great job as usual, always give something to think about,
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    1. Thank you Jennifer. 2013 has many similarities with 1913 before the Fist World War. Unless politicians get their act together and do something about rising inequality things will start happening. Suddenly something happens that sparks developments we would rather avoid. Interesting that you say in the US people are turning against each other. That is most likely happening in some European countries as well.

      1. Yeah I bet if we were able to take a close look at some of the things that are going on it would boil down to the inequality around the world and the things that people are doing to one another. I just don't think that people realize that that is were they are is coming from and convince themselves it is because of another persons race, religion or whatever.

        We will see how things turn out, hopefully not like 1913, people have a lot more weapons to bad things with to harm other people, masses of people.
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  40. Ideally, I would want to know more details before commenting. For example, is it that the rich are getting richer and the poor staying poor or the poor are getting to be a bigger group or are the poor getting to be a bigger group AND are getting poorer? I suspect it's the last one. In any case, Catarina, you do a great job of getting us interested in the topic. I suspect the answers economists suggest vary according to their biases.
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    1. Leora, poverty is on the increase and the poor are on top of it getting poorer as you say. The recent economic crisis has made the problem fatal. Unemployment has got out of hand and most likely the jobs lost will not be filled again. Just read an article in Swedish about the huge problem of poverty in Israel. But it's not even an issue for the upcoming elections. It was thought that the widening income disparity would be important, but instead the issue is ignored.

  41. In the US we have been feeling this for quite some time now. I remember when my wife and I were just married the job I was working at the time, I was making roughly the same as my wife's father who had been at his job for 20 years or so. My wife's parents were moderate middle class at the time. Looking at it all now, our wages have not gone up but what it takes to survive has. That same wage now (which is quite common) places you, if you are lucky, within the realm of poverty.
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  42. I am no expert on this subject and I can see no easy solutions at hand. I suspect that the problem is probably not that far away from reaching critical mass. I shudder to think what will happen when it does.
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    1. Yes Cheryl, it's getting out of hand and it will take a long time before something is done about what world leaders call the main risk we face. It's no coincidence that leaders said it in a survey. If they had said it on record ultra right politicians would have called them socialists and they would have had to face the kind of treatment Obama has had from parts of the republican party.

  43. Quite a timely post, Catarina, as the "Idle No More" protest is well underway here in Canada, protesting against the government for not addressing the poverty issues among aboriginal First Nations peoples here in Canada. Even though Canada is one of the most prosperous countries in the world, residents of the First Nations reserves often live in poverty and at Third World standards. But unfortunately, in Canada, just as in other countries where there are groups facing inequalities, the leaders of some of the aboriginal communities have been found to be corrupt and misusing funds allocated by the federal government for the sake of bettering the lives of their people. I have no answers to this most unfortunate state of inequality. Just wanted to bring it forward in the event you were unaware.
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    1. Thank you Doreen. Interesting points about native Canadians. Am not an expert on Canada, but I would be surprised if income disparity isn't growing there as in other developed countries? It is in Sweden, another of the best performing countries in the world.

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