IMF's Strauss-Kahn "bemoaned a large and growing chasm between rich and poor—especially within

[pampango]

countries."

http://www.economist.com/node/17957381?story_id=17957381&fsrc=rss

Mr Strauss-Kahn then bemoaned “a large and growing chasm between rich and poor—especially within countries”. He argued that inequitable distribution of wealth could “wear down the social fabric”. He added: “More unequal countries have worse social indicators, a poorer human-development record, and higher degrees of economic insecurity and anxiety.”

That marks a huge shift. Just before the financial crisis America’s Congress was gaily cutting taxes for the highest earners, and Tony Blair, Britain’s prime minister, said he did not care how much soccer players earned so long as he could reduce child poverty. So why has fear of inequality stormed back into fashion? Does it matter in some new way? Does it have previously unknown effects?

The economists Emmanuel Saez and Thomas Piketty studied the incomes of the top 0.1% of earners in America, Britain and France in 1913-2008. America’s super-rich, they found, were earning about 8% of the country’s total income at the end of the period—the same share as during the Gilded Era of the 1920s and up from around 2% in the 1960s. A study by the Economic Policy Institute, a think-tank in Washington, DC, looked at the ratio of the average incomes of the rich and the “bottom” 90% of the population between 1980 and 2006. It found that the top 1% earned ten times more than the rest at the start of the period and 20 times as much at the end—ie, its “premium” doubled. But for the top 0.1% the gain rose from 20 times the earnings of the lower 90% to almost 80-fold.

Nordic countries have low income inequality and not too much status competition. But one can also imagine societies with narrow income disparities that are riddled with status conflict. The old Soviet Union is a vivid example. The inverse is conceivable too: countries with large income disparities but less status conflict, perhaps because competition is smoothed by social mobility. Arguably America fitted that description until recently. Overall though, it is true that in most places growing income disparities are a reasonable proxy for growing status competition.



Interesting that a society with a great deal of social mobility may be able to tolerate a higher level of income inequality than one with limited social mobility. The US has become one one with the highest income inequality in the developed world and lower social mobility than exists in Europe and Canada.

[ladjf]

1. The accelerating shift of wealth to the super rich is the greatest

problem facing mankind. When extrapolated out into the future, say 30 years or more, the outcome is catastrophic in many dire ways. For the general population there will be almost universal poverty and slavery. For the environment, huge parts of the ecosystem that supports life will have been degraded by uncontrolled exploitation by the super rich for quick profits.

Millions of humans are already aware of the wealth shift problem and it's consequences. However, I notice that almost nothing constructive is being discussed to stop the problem. It seems that although people understand what is happening and is going to happen, they have no hope that the problem could be solved. They may well be wrong to be so pessimistic.

[Supersedeas]

4. and yet it was the middle classes that was forced to bailout the banks

[ladjf]

6. Somehow we've got to jack up the tax rate on the super rich and

make them start paying their fair share. More Americans need to be made aware that the rich are stealing their money and that in the end disaster will occur.

[shanti]

7. how do you propose we make them do that?

the wealthy OWN this country. they won't just raise taxes on themselves without a fight...and we aren't doing a very good job of forcing the issue. i just don't see that happening. :shrug:

[ladjf]

8. Not easy. The best hope is to elect a Democrat in 2012 who will

campaign on the one issue of stopping the wealth shift mainly by raising the taxes on the rich. That will difficult to do. Obama is in line to get the Democratic nomination and we already know that his promises can't be trusted. If not 2012,then 2016.

The only way to stop the heist is to raise the taxes on the rich. Unless the vote counting system is widely rigged, there is always a possibility that enough Americans could rally around one point and win the election.

What choices to we have? We either have to fight with the odds against us or just give up. Giving up has no chance.

There are other political factors than just the wealth shift, i.e. declining education, the political biases of the Supreme Court Justices, the battle against the labor unions, vote count rigging, the media control, the fight against alternative energy initiatives by the fossil fuel companies, the payoffs to politicians and the counter productive noise by the right-wing. All of these are fed by the money from the super rich.

[xchrom]

2. Recommend

[SpiralHawk]

3. "Cool. This is soooo perfect. Sneer." - RepubliCronies (R)

"Giga dittoes. Smirk. Sneer." - Rush DraftDodger Limbaugh (R - Chief Propagandist)

[blindpig]

5. Geez Mr Banker, whose fault is that?

The IMF has been immiserizing the masses for decades and the upper class has benefited from that greatly. He's concerned, reap what you sow motherfucker.