Tag Archives | income inequality

Child Abuse Rises with Income Inequality

Pic: Neon Zero (CC)

Pic: Neon Zero (CC)

Via ScienceDaily:

As the Great Recession deepened and income inequality became more pronounced, county-by-county rates of child maltreatment — from sexual, physical and emotional abuse to traumatic brain injuries and death — worsened, according to a nationwide study by Cornell University.

The income inequality-child maltreatment study, to be published in the March 2014 edition of the peer-review journal Pediatrics, covers all 3,142 American counties from 2005-09, and is one of the most comprehensive of its kind and the first to target child abuse in places with the greatest gap between rich and poor.

“Our study is the first to demonstrate that increases in income inequality are associated with increases in child maltreatment,” said John J. Eckenrode, professor of human development and director of the Family Life Development Center in the College of Human Ecology. “More equal societies, states and communities have fewer health and social problems than less equal ones — that much was known.

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85 Wealthy Elites Have As Much Wealth As Half The World’s Population

rich peopleA group that could easily fit on a single subway car. Via the Guardian:

The extent to which so much global wealth has become corralled by a virtual handful of the so-called ‘global elite’ is exposed in a new report from Oxfam on Monday. It warned that those richest 85 people across the globe share a combined wealth of £1tn, as much as the poorest 3.5 billion of the world’s population.

The development charity fears this concentration of economic resources is threatening political stability and driving up social tensions.

The report found that over the past few decades, the rich have successfully wielded political influence to skew policies in their favor on issues ranging from financial deregulation, tax havens, to lower tax rates on high incomes and cuts in public services for the majority. Since the late 1970s, tax rates for the richest have fallen in 29 out of 30 countries for which data are available, said the report.

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Soaring Profits Do Not Equal Investment

It is taken for granted in conservative circles at that lower taxes on the rich will lead to greater investment in the economy, and therefore jobs—but the data tell a very different story. This analysis comes from Gerald Friedman of Dollars & Sense:

Net Investments and Profits

“The share of national income going to investment (net of depreciation of existing plant and machinery) has been declining since the beginning of the “neoliberal” era, around 1980. Since the start of the Great Recession, net investment as a share of GDP has plummeted to its lowest level since the 1930s. This sharp drop in investment comes despite sharply rising profits.”

Monetary Policy Isn’t Working: The Federal Reserve has helped to shorten past recessions by driving down interest rates to lower the cost of borrowing and so spur investment. During the current crisis, the Fed has conducted an aggressive monetary policy, raising the money supply to lower interest rates.… Read the rest

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The New Feudalism In Silicon Valley

valleyVia the Weekly Standard, Charlotte Allen writes that the tech bastion offers a preview of where society as a whole is headed:

Master and servant. Cornucopian wealth for a few tech oligarchs plus relatively steady but relatively low-paying work for their lucky retainers. No middle class, unless the top 5 percent U.S. income bracket counts as middle class. Silicon Valley is a tableau vivant of what many economists and professional futurologists say is the coming fate of America itself, a fate to which Americans, if they can’t embrace it as some futurologists hope, should at least resign themselves.

The increasing ability of computers to perform ordinary tasks will inexorably transform America into an income oligarchy in which the top 15 percent of people—with skills “that are a complement to the computer”—will enjoy “cheery” labor-market prospects and soaring incomes, while the bottom 85 percent, that is to say, 267 million out of America’s 315 million people, will be lucky to find Walmart-level jobs or scrape together marginal “freelance” livings running $25-a-pop errands for their betters via TaskRabbit (say, picking up and delivering a pair of designer shoes).

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Switzerland To Vote On Radically Limiting CEOs’ Pay Nationwide

ZurichMontageMost likely with fists clenched and all the blood drained from its face, the Wall Street Journal reports:

Switzerland is expected to vote later this year on a proposal to place further limits on executive pay, the latest effort to govern corporate compensation in a country that recently approved some of the world’s strictest say-on-pay rules.

The Young Socialists have collected more than 100,000 signatures—the threshold needed to call a vote—in support of a referendum to limit executive salaries to 12 times those of a company’s lowest-paid employee.

The campaign, dubbed the 1:12 Initiative for Fair Pay, is named for the organizers’ belief that no one in a company should earn more in one month than the lowest-paid employee makes in a year.

The Swiss Federal Council, the country’s cabinet, has advised the parliament to recommend that voters reject the proposal. However a poll earlier this month showed 49.5% of respondents were in favor of the 1:12 Initiative, 40.5% against and 10% undecided.

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100 Wal-Mart Workers Arrested In Nationwide Protests Last Week

walmartIncluding three attempting to deliver a petition to a Wal-Mart executive’s Manhattan office. Imagine how awkward that would have been! Buzzfeed reports:

100 Walmart workers protesting low wages and illegal retaliation against strikers were arrested in 11 cities on Thursday. In response to Walmart’s inaction, workers announced widespread, massive strikes and protests will take place on Black Friday in 2013.

The New York Police Department arrested three Walmart strikers who wanted to meet with an executive. The protesters planned to deliver a petition directly to company board member Christopher Williams’ Fifth Avenue office. The petition demands Walmart provide employees with a livable, annual wage of $25,000, and stop punishing workers who stand up for their rights. Walmart fired or disciplined at least 60 strikers who protested in June.

Walmart spokesperson Kory Lundberg said that these demonstrations are “just a show.”

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Financial Insecurity Causes Temporary IQ Drop Of 13 Points

moneyHow poverty impacts people, via the Seattle Times:

People worrying about having enough money to pay bills tend to lose temporarily the equivalent of 13 IQ points, scientists found when they gave intelligence tests to shoppers at a New Jersey mall and farmers in India.

Dealing with financial strain consumes so much mental energy that people struggling to make ends meet often have little brainpower left for anything else, leaving them more susceptible to bad decisions that can perpetuate their situation, according to the new study.

Mullainathan and colleagues tested the same 464 farmers in the sugar-cane fields of India before and after the harvest and their IQ scores improved by 25 percent when their wallets fattened. Before the harvest, the farmers take out loans and pawn goods. After they sell their harvest, they are flush with cash.

In the New Jersey part of the study, the scientists tested about 400 shoppers at Quaker Bridge Mall, presenting them with scenarios that involved a large and a small car-repair bill.

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Rich People Feel Poor If They Have Less Than $5 Million

wealthyVia ThinkProgress, a survey of investors reveals the self-perception of the affluent in our deeply unequal society. More than two-thirds of millionaires do not feel that they are wealthy, and two-fifths of those with more than $5 million still feel non-wealthy:

Rich investors say that it takes at least $5 million to feel wealthy, according to a new investor sentiment report from UBS.

They also define being wealthy not as having a certain amount of money, but having “no financial constraints on what they do.” That does indeed likely come with a large price tag.

The inflation of how much the rich thinks it takes to be rich comes at a time of skyrocketing income inequality. The good news for the uber rich is that less than 20 percent have a pessimistic view of the long-term economic outlook. That differs sharply from the general population, as half of Americans say the economy is getting worse.

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It’s Time To Introduce A Global Minimum Wage

global minimum wage

Al Jazeera, Dr. Jason Hickel argues that a global minimum wage is not only just, but doable:

Because of neoliberal economic policies imposed over the past few decades, companies now have the power to rove the globe in search of what CEOs refer to as the “best investment conditions”.

So workers are made to face a stark choice: accept dangerous conditions and minimum wages of $0.21 per hour, or lose their jobs. The constant threat of replacement keeps workers cheap and docile, to the tremendous benefit of corporate profits.

The problem with globalisation is that capital has been globalised while the rules that protect people from it have not. If we’re going to have a global labour market, it stands to reason that we need a global system of labour standards [and] a global minimum wage.

Not only is it now conceivable to have a global minimum wage system, it’s also – for the first time in history – quite doable.

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Chinese Factory Workers Take Their American CEO Hostage

ceo_chipChip Starnes, CEO of Specialty Medical Supplies, flew to his company’s factory in China to lay off 30 workers as a first step in shifting production to India, where wages are lower. It is difficult to feel sorry for him regarding what subsequently occurred. Via Libcom:

Workers at a medical supplies factory in Beijing, China, have taken the owner of the factory hostage. He has been locked in his office for several days, and subject to sleep deprivation techniques. The action was taken following a dispute over unpaid wages and severance pay.

The factory boss, Chip Starnes, visited the factory last week to lay-off thirty workers. He gave them a redundancy payment and then intended on leaving. As soon as the rest of the workers on shift realised what was happening they thought the entire factory was about to close down and barricaded him in his office.

When interviewed, workers also claimed that their action was also due to unpaid wages over the last few months.

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