The pernicious impact of the widening wealth gap

20 Jan, 2014 at 18:19 | Posted in Politics & Society | 1 Comment

The 85 richest people on the planet have accumulated as much wealth between them as half of the world’s population, political and financial leaders have been warned ahead of their annual gathering in the Swiss resort of Davos.

The tiny elite of multibillionaires, who could fit into a double-decker bus, have piled up fortunes equivalent to the wealth of the world’s poorest 3.5bn people, according to a new analysis by Oxfam. The charity condemned the “pernicious” impact of the steadily growing gap between a small group of the super-rich and hundreds of millions of their fellow citizens, arguing it could trigger social unrest.

inequality-cartoon2It released the research on the eve of the World Economic Forum, starting on Wednesday, which brings together many of the most influential figures in international trade, business, finance and politics including David Cameron and George Osborne. Disparities in income and wealth will be high on its agenda, along with driving up international health standards and mitigating the impact of climate change.

Oxfam said the world’s richest 85 people boast a collective worth of $1.7trn (£1trn). Top of the pile is Carlos Slim Helu, the Mexican telecommunications mogul, whose family’s net wealth is estimated by Forbes business magazine at $73bn. He is followed by Bill Gates, the Microsoft founder and philanthropist, whose worth is put at $67bn and is one of 31 Americans on the list.

Nigel Morris/The Independent

[h/t Jan Milch]

Walked-out Harvard economist and George Bush advisor  Greg Mankiw wrote an article last year on the “just desert” of the one percent, arguing that a market economy is some kind of moral free zone where, if left undisturbed, people get what they “deserve.”

This should come as no surprise. Most neoclassical economists actually have a more or less Panglossian view on unfettered markets. Add to that a neoliberal philosophy of a Robert Nozick or a David Gauthier, and you get Mankiwian nonsense on the growing inequality.

A society where we allow the inequality of incomes and wealth to increase without bounds, sooner or later implodes. The cement that keeps us together erodes and in the end we are only left with people dipped in the ice cold water of egoism and greed.

1 Comment

  1. “The 85 richest people on the planet have accumulated as much wealth between them as half of the world’s population, ”

    Most of this is leveraged paper wealth. The whole idea is a strawman argument. If some of these rich people try to liquidate their wealth in one day they may end up with a few million dollars, less than the savings of a good doctor in New York.

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