Tag Archives | Inequality

Inequality and the USA: A Nation in Denial?

Homeless female holding up sign (7617876912).jpg

Photo: Alex Proimos (CC)

Sam Pizzigati of Inequality.org writes at PressTV that “the United States… doesn’t just have the world’s most unequal major developed economy… [it] has the most people in denial about the inequality they live amid”:

Every August, for most of the last four decades, top central bankers from around the world have been making their way to the Wyoming mountain resort of Jackson Hole for an invitation-only blue-ribbon economic symposium.

This year’s Jackson Hole hobnob, once again hosted by the Federal Reserve Bank of Kansas City, last week attracted the usual assortment of central bankers, finance ministers, and influential business journalists. But this year’s gathering also attracted something else: protesters.

For the first time ever, activists converged on Jackson Hole — to let the Fed’s central bankers know, as protest organizers put it, that “it’s not just the rich who are watching them.”

Over 70 groups and unions backed the protest and signed onto an open letter that calls on America’s central bankers to start nurturing an economy that works for workers.

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Federal Reserve President: ‘QE Was A Massive Gift Intended To Boost Wealth’

So sayeth Richard W. Fisher, President and CEO of the Federal Reserve Bank of Dallas, according to Tyler Durnden writing at Zero Hedge:

With Bernanke gone, the remaining Fed members knowing full well they will be crucified, metaphorically of course (if not literally) when it all inevitably comes crashing down, are finally at liberty with their words… and the truth is bleeding out courtesy of the president of the Dallas Fed, via Bloomberg.

FISHER SAYS QE WAS A MASSIVE GIFT INTENDED TO BOOST WEALTH
Which incidentally coincides with Bernanke’s heartfelt “admission” that “my natural inclinations, even if it weren’t for the legal mandate, would be to try to help the average person.” As long as helped to boost the wealth of the non-average billionaire., all is forgiven. “The result was there are still many people after the crisis who still feel that it was unfair that some companies got helped and small banks and small business and average families didn’t get direct help,” Bernanke said.

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The Richest Man in the World Explains How to Save the Planet

BillGates2012Bill Gates really wants to do good things, but there are plenty of people who think he has a hidden and possibly nefarious agenda. He opens up for Rolling Stone, in this segment speaking about income inequality:

RS: Let’s talk about income inequality, which economist Paul Krugman and others have written a lot about. As a person who’s at the very top of the one percent, do you see this as one of the great issues of our time?

BG: Well, now you’re getting into sort of complicated issues. In general, on taxation-type things, you’d think of me as a Democrat. That is, when tax rates are below, say, 50 percent, I believe there often is room for additional taxation. And I’ve been very upfront on the need to increase estate taxes. Particularly given the medical obligations that the state is taking on and the costs that those have over time.

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Why The Rich Are Freaking Out

Dollar symbol goldPolitico‘s Ben White tells us that the 1%, the super wealthy elite, are having a collective meltdown at the prospect of less favorable attitudes and laws targeting them:

The co-founder of one the nation’s oldest venture capital firms fears a possible genocide against the wealthy. Residents of Manhattan’s tony Upper East Side say the progressive mayor didn’t plow their streets as a form of frosty revenge. And the co-founder of Home Depot recently warned the Pope to pipe down about economic inequality.

The nation’s wealthiest, denizens of the loftiest slice of the 1 percent, appear to be having a collective meltdown.

Economists, advisers to the wealthy and the wealthy themselves describe a deep-seated anxiety that the national — and even global — mood is turning against the super-rich in ways that ultimately could prove dangerous and hard to control.

President Barack Obama and the Democrats have pivoted to income inequality ahead of the midterm elections.

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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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David Simon Speech: ‘There are now two Americas. My country is a horror show’

David Simon at Rising Tide 2011Best known as the creator of seminal TV series The Wire, David Simon gave an impromptu speech about the divide between rich and poor in America at the Festival of Dangerous Ideas in Sydney, and how capitalism has lost sight of its social compact. This is an edited extract via The Guardian:

America is a country that is now utterly divided when it comes to its society, its economy, its politics. There are definitely two Americas. I live in one, on one block in Baltimore that is part of the viable America, the America that is connected to its own economy, where there is a plausible future for the people born into it. About 20 blocks away is another America entirely. It’s astonishing how little we have to do with each other, and yet we are living in such proximity.

There’s no barbed wire around West Baltimore or around East Baltimore, around Pimlico, the areas in my city that have been utterly divorced from the American experience that I know.

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Why Eating Healthy Food Will Cost Your Family $2,000/Year More Than Processed Junk

Organic FoodThe gap between haves and have nots becomes ever more obvious when the have nots can only afford to eat processed junk that doesn’t deserve the moniker “food.” CBC reports on a study demonstrating the disturbing correlation between healthy eating and high income:

A family on a healthy diet can expect to pay $2,000 more a year for food than one having less nutritious meals, say researchers who recommend that the cost gap be closed.

The research in Thursday’s issue of British Medical Journal Open reviewed 27 studies from 10 high-income countries to evaluate the price differences of foods and diet patterns.

“Our results indicate that lowering the price of healthier diet patterns — on average about $1.50/day more expensive — should be a goal of public health and policy efforts, and some studies suggest that this intervention can indeed reduce consumption of unhealthy foods,” Dariush Mozaffarian, the study’s senior author and a professor at the Harvard School of Public Health and his co-authors concluded.

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Contracts With Workers Vs. Contracts With Banks

contracts

When are contracts ironbound, and when are they optional? Via the Center for Economic & Policy Research, Dean Baker writes:

The debate over public pensions clearly shows the contempt that the elites have for ordinary workers. While elites routinely preach the sanctity of contract when it works to benefit the rich and powerful, they are happy to treat the contracts that provide workers with pensions as worthless scraps of paper.

We see this attitude on display currently in the Detroit bankruptcy proceedings. It is even more clearly on display in efforts by Chicago Mayor Rahm Emanuel to default on the city’s pension obligations.

The basic story in both cases is that the contracts that workers had labored under are being laughed at by the elites because they find it inconvenient to carry through with the terms.

In Detroit, paying for pensions or anything else without outside assistance poses a real problem.

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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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