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Archive for Wednesday, October 22, 2008

Study shows gap growing between rich and poor

October 22, 2008

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— Economic inequality is growing in the world's richest countries, particularly in the United States, jeopardizing the American Dream of social mobility just as the world tilts toward recession, a 30-nation report said Tuesday.

The gap between rich and poor has widened over the last 20 years in nearly all the countries studied, even as trade and technological advances have spurred rapid growth in their economies.

With job losses and home foreclosures skyrocketing and many of these countries now facing recession, policymakers must act quickly to prevent a surge in populist and protectionist sentiment as was seen following the Great Depression, the Paris-based Organization for Economic Cooperation and Development said.

"What will happen if the next decade is not one of world growth but of world recession? If a rising tide didn't lift all boats, how will they be affected by an ebbing tide?" Oxford University economist Anthony Atkinson said at a conference at the OECD headquarters.

In a 20-year study of its member countries, the OECD found inequality had increased in 27 of its 30 members as top earners' incomes soared while others' stagnated.

The United States has the highest inequality and poverty rates in the OECD after Mexico and Turkey, and the gap has increased rapidly since 2000, the report said. France, meanwhile, has seen inequalities fall in the past 20 years as poorer workers are better paid.

Rising inequality threatens social mobility - children doing better than their parents, the poor improving their lot through hard work - which is lower in countries like the U.S., Great Britain and Italy, where inequality is high, than countries with less inequality such as Denmark, Sweden and Australia, the report said.

Wealthy households are not only widening the gap with the poor, but in countries such as the U.S., Canada and Germany they are also leaving middle-income earners further behind, with potentially ominous consequences if the global financial crisis sparks a long recession.

The two decades covered in the study - 1985-2005 - saw the development of wider global trade and the Internet, and a period of overall strong economic growth. The countries covered are mostly developed nations, especially in Europe.

OECD Secretary-General Angel Gurria said that the study, which took three years to complete, would be useful to policymakers because it is coming out just as the world is undergoing "the worst crisis in decades."

Gurria urged governments to address the "divisive" issue of growing inequality. He said they should do more to educate the whole work force - and not just the elite - while helping people get jobs and increasing incomes for working families, rather than relying on social benefits.

"Greater income inequality stifles upward mobility between generations, making it harder for talented and hardworking people to get the rewards they deserve," he said in a statement. "It polarizes societies, it divides regions within countries, and it carves up the world between rich and poor."

In the United States, the richest 10 percent earn an average of $93,000 - the highest level in the OECD. The poorest 10 percent earn an average of $5,800 - about 20 percent lower than the OECD average.

Comments

staff04 5 years, 6 months ago

""He wants affordable health care for everyone."At least he's said how on this one - too bad his plan is a complete fabrication and won't work."--------------------------------------------------------------------Just curious to know what your experience in healthcare policy is--you know, so we can all make sure we know why to believe you.

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jonas_opines 5 years, 6 months ago

No, this was your apparent criteria, not mine. Are we talking just about the aggregate of the economies, or about the distribution of their wealth? Regardless, it doesn't change the basic fact that the potential for exploitation does exist under capitalism, and has resulted in exploitation in the past. And the present.

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Koolaid 5 years, 6 months ago

The short period of a capitalistic system has made it the largest economy in the region..Where as Cuba has had about the same time with its Socialistic system and it is suffering. It was once the largest economy in the region. So by your criteria cuba can just write off its decline as socialist shrinking pains, or pool shrinkage?

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jonas_opines 5 years, 6 months ago

Ah, I see. So due to the short period of time, relatively so, the problems in the capitalistic system can be written off as, what, growing pains? But no such capitulation made the other way around?

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Koolaid 5 years, 6 months ago

J-O,You didn't say Haiti, you said Dominican Republic. Basically the same thing:Wiki: Since the death of military dictator Rafael Leonidas Trujillo Molina in 1961, the Dominican Republic has moved toward a liberal economic model, which has made it the largest economy in the region, and towards representative democracy. (Liberal meaning Capitalistic in this usage)

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Koolaid 5 years, 6 months ago

Jonas_Opines,Haiti has spent half of its modern existence under the rule of the military. It has only recently become a "democratic republic" and only with US intervention. Not a good comparison. Switzerland?

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Koolaid 5 years, 6 months ago

notajayhawk writes: "boohoozo"OMG, Hillarious!! You floored me with that one.I tip my hatOh Yeah, Koolaid

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notajayhawk 5 years, 6 months ago

black_butterfly (Anonymous) says:"...having a president who had a clear cut plan to improve the lives of americans."Uh huh."Obama wants to make higher education more affordable for everyone so that more people can be self sufficient and not need government assistance."Which he's going to do how, again?"He wants to decrease unemployment."Which he's going to do how, again?"He wants affordable health care for everyone."At least he's said how on this one - too bad his plan is a complete fabrication and won't work."He does not want to put everyone on welfare."Of course not 'everyone' - he needs the rich to keep paying for the rest."He just wants to make sure that the "working class" (of all races) have a fair chance of survival."Since the disappearing middle class has been moving into the upper class, maybe we shouldn't be thinking in terms of keeping them in "survival" mode and keep on encouraging them to move up, as they have been. Oh, sorry, forgot, we can't have the middle class moving up because that would widen the gap between rich and poor farther, and the class envy in good old looneyville couldn't stand that. Let's keep everyone 'surviving' in mediocrity (being supported by someone else's taxes) instead of having them move up. The American dream, alright.

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black_butterfly 5 years, 6 months ago

This is what Obama has in mind- Obama wants to make higher education more affordable for everyone so that more people can be self sufficient and not need government assistance. He wants to decrease unemployment. He wants affordable health care for everyone. He does not want to put everyone on welfare. He just wants to make sure that the "working class" (of all races) have a fair chance of survival. I can't believe that a lot of you want more of the same despair that we have had these past 8 years rather than having a president who had a clear cut plan to improve the lives of americans.

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notajayhawk 5 years, 6 months ago

just_another_bozo_on_this_bus (Anonymous) blathers: "Is it any surprise? We've had nearly 30 years of Republican class warfare, which was merely slowed a tad under Clinton."Tell me something, boohoozo, did the other 26 of 29 OECD countries where the gap increased also have "30 years of Republican class warfare?"***kmat (Anonymous) says: "So, let the big corporations skip paying taxes while we tax the middle class to death."Exxon - just one single corporation - paid $30 billion in taxes, over 40% of their earnings. That's roughly what the entire lower 50% of taxpayers paid in income taxes in 2006. The average tax rate, incidentally, for the lower 50%, has dropped almost in half since 1985 - from 5.77% to 3.01%. Yep, those Republicans have really been sticking it to us.**dandelion (Anonymous) says: "What you money hungry Republicans don't realize is that some of us just want to be middle class. We don't want to be filthy rich. But it's becoming a choice of being poor or trying to play the game to be rich. If you destroy the middle class, you will destroy democracy and freedom, and upward mobility."I don't suppose, dandelion, that you have any idea where the middle class has been disappearing to? You might try looking it up some time - I think you'll find the poor isn't the group that's getting bigger as the middle class shrinks.******I find it deeply amusing that the defenders of socialism in good old Larryville completely ignored this part of the story:"He said they should do more to educate the whole work force - and not just the elite - while helping people get jobs and increasing incomes for working families, rather than relying on social benefits."Somehow I don't think that's what good ol' Obamamama has in mind by spreading the wealth.

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dandelion 5 years, 6 months ago

YES, yes and yes to all the above. The checker is certainly working hard, but that is the path they have chosen.But why shouldn't a checker be able to make a decent living. Yes, the boss should make more money, but in these run away corporations the bosses have made money, then failed at their jobs. Then their still rewarded. Who does the real work? The failure executive? or the hard working checker? A bad doctor would be put out of business, because of lawsuits. A bad lawyer wouldn't eventually be disbarred or get no clients. But a bad executive gets a golden parachute. This is broke.

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jonas_opines 5 years, 6 months ago

koolaid: I think capitalism is, in the end, the more effective system. But I think the proper mix of both is the best. You ever been to the Hatian canecutter villages in the Dominican Republic? The factbook lists that country as a democratic republic.

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kansas778 5 years, 6 months ago

denak (Anonymous) says: For those who believe that our poor are still rich, try living on less than 6,000 a year. If you don't think people do just that, go look at some places in West Virginia or Mississippi. They live in shacks with no heat or clean water. There are people in this country that truely live in 3rd world conditions.*****This simply isn't true. The stereotypical poverty you think occurs is actually quite rare. According to the government something like 37 million Americans are living in "poverty" but what are their lives actually like?46 percent of all poor households actually own their own homes.Only six percent of poor households are overcrowdedThe typical poor American has more living space than the average individual living in Paris, London, Vienna, Athens, and other cities throughout Europe. (These comparisons are to the average citizens in foreign countries, not to those classified as poor.)Nearly three quarters of poor households own a car; 31 percent own two or more cars97 percent of poor households have a color television; over half own two or more color televisions.78 percent have a VCR or DVD player.89 percent own microwave ovens, more than half have a stereo, and a more than a third have an automatic dishwasher.Overall, the typical American defined as poor by the government has a car, air conditioning, a refrigerator, a stove, a clothes washer and dryer, and a microwave. He has two color televisions, cable or satellite TV reception, a VCR, or DVD player, and a stereo. He is able to obtain medical care. His home is in good repair and is not overcrowded. By his own report, his family is not hungry, and he had sufficient funds in the past year to meet his family's essential needs. While this individual's life is not opulent, it is far from what you suggest.

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denak 5 years, 6 months ago

For those who believe that our poor are still rich, try living on less than 6,000 a year. If you don't think people do just that, go look at some places in West Virginia or Mississippi. They live in shacks with no heat or clean water. There are people in this country that truely live in 3rd world conditions.Secondly, when I took political science classes in college, one of the best predictor of democracy and the sustaniability of democracy, is the emergence and strength of the a middle class. The poor are not able to fight for their rights because they do not have the economic ability to do so. They don't have the luxery of caring what the government does because they are trying to survive. However, once a country is stable enough to sustain and grow a middle class, the country usually becomes more democratic because the new middle class are able to send their children to college and have time to devote to political issues. The middle class also provides a tax base so that the government can provide safety nets for those in the lower class which takes off some of the pressure on the government.If the gap between rich and poor continues to grow, it is only logical to think that the inverse will start to happen. We will start to lose rights and political power. The more the middle class struggles and starts to descend into the lower class, the less able they are to confront those with power and those with power will be the ones who have money.Dena

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Koolaid 5 years, 6 months ago

jonas-opines,The quality of life, environmental stewardship, and general welfare were much better in the soviet union? Right? Oh, wait a minute, our system has produced a much better standard of living even for those living below the poverty line. DOH!Have you ever been to the eastern bloc and seen how they lived? Not the PBS version but actually been there? It isn't very nice, everywhere.

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tangential_reasoners_anonymous 5 years, 6 months ago

Koolaid, et al.: "... that is the path they have chosen."Interesting when the "path" abruptly, unexpectedly changes forthe self-rationalizing self-serving. ( Learning will occur. )

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jonas_opines 5 years, 6 months ago

Under communism, man exploits man. Under capitalism, it's the other way around.

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Koolaid 5 years, 6 months ago

dandelion,Does the checker have a college degree?Does the checker take extra time networking?Does the checker invest time in the right social circles?Does the checker reinvest earnings into stocks?Does the checker have the same opportunity?YES, yes and yes to all the above. The checker is certainly working hard, but that is the path they have chosen. Do you want that checker operating on your heart? Or do you want the Doctor that has invested several years in study, several more in residency and finally several in practice? Check out person does not equal corporate executive. One has a very valuable skill set, the other has a $10 an hour skill set. Communism doesn't work, where have you people been the last 70 years?

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dandelion 5 years, 6 months ago

What you money hungry Republicans don't realize is that some of us just want to be middle class. We don't want to be filthy rich. But it's becoming a choice of being poor or trying to play the game to be rich. If you destroy the middle class, you will destroy democracy and freedom, and upward mobility. The poor people I know work a lot harder than some rich executive sitting at a desk and playing golf in the afternoon. Can you tell me that the checker at your grocery, who is probably working at another job on the side to make ends meet is lazy? What a fool.

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KU_cynic 5 years, 6 months ago

The gap between rich and poor widening is a lot lack the widening gap between Michael Phelps's 400 meter freestyle time and mine. It's not so much that I am swimming more slowly but rather that he is swimming faster and faster.By almost any common sense measure of well-being, the poor and middle class in developing countries have better health care and better health, better food and shelter, and more goodies like big screen TVs, safe and dependable cars, internet access, etc. -- than ever before. Yes, the super wealthy are wealthier than the super wealthy of earlier generations -- mostly because the innovations and talent that generates their wealth is more highly valued by a greater number of people than the innovations of earlier generations Think: Why is Bill Gates so freaking rich? Focusing on the gap rather than abolute measures of well-being of the poor and middle classes only feeds envy, the politics of envy, and other sicknesses of the soul.

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kansas778 5 years, 6 months ago

Let's do away with these protectionist regulations that protect business from competition. Get rid of government oversight and regulation so that new competition can enter the market and create new opportunities. All the red tape is an effective barrier to new competition, thus allowing the rich to get richer because they have an oligopoly.

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staff04 5 years, 6 months ago

And Kevin is just as delusional as any of them. The Seniors' freebie can't be bringing in $250K...but somehow Obama is a threat to his wealth.

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Koolaid 5 years, 6 months ago

Duplenty,Look in the mirror, there you have your two amazingly stupid posters.Class warfare: The media is fueling class division before the election. The statistics used are at best manipulated to support the lefts argument. There are lies, damn lies and statistics. All the hysteria is exactly what the Obama national socialists want.

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duplenty 5 years, 6 months ago

It's amazing the amount of stupidity that comes from the same one or two people on these boards...

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staff04 5 years, 6 months ago

"You can tell that certain posters on here have absolutely no facts about the suppositions they make and only want it to be the way they fantasize"I don't really like Bill Maher, but he said exactly the same thing on his show recently. See the clip:http://www.youtube.com/watch?v=ke7dSYFMuiE

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just_another_bozo_on_this_bus 5 years, 6 months ago

"You can tell that certain posters on here have absolutely no facts about the suppositions they make and only want it to be the way they fantasize:"You mean the ones who over-generalize that all poor people are bad and lazy people who deserve their miserable existence and that all rich people are good and virtuous, hardworking people who deserve everything they have, cause God really likes them better than the nasty awful poor people?

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oldvet 5 years, 6 months ago

"You can tell that certain posters on here were born into money and have never actually worked for anything."You can tell that certain posters on here have absolutely no facts about the suppositions they make and only want it to be the way they fantasize...

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i_tching 5 years, 6 months ago

The role of government is to help the rich get even richer, while at the same time stomping on the poor, working, and middle classes.

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invictus 5 years, 6 months ago

Yep some parents take an active interest in their children. This includes creating a financial safety net for them so they can take chances and better themselves. Some parents are only interested in themselves and don't care about their children or legacy.

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RedwoodCoast 5 years, 6 months ago

Yep, I like that there are haves and have-nots. It is good for the economy for the rich to get richer and poor to get poorer. It's been working so well lately.

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Confrontation 5 years, 6 months ago

You can tell that certain posters on here were born into money and have never actually worked for anything. They are the same ones who claim that anyone can be rich. Sure, the rare poor person invents something and makes a bundle on QVC. However, it's a whole lot easier to get rich if you never pay for your own education, daddy buys your first home, and someone is willing to invest in your business.

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Rex Russell 5 years, 6 months ago

Alright Tom, let's disect your lack of Hobbsian thought process a little. If we are to shout to the whole world that the US is the land of oportunity, the land of equality, that hard work and a good head will get you to the top, that all things being equal the guy with the go-get'em-attitude will get farther, it ought to be at least a little bit true. It is closer to the truth to say that ,given 2 people with the same intellect,self-motivation and background, the one with the greater resources from the onset will reach higher. Family wealth begets family wealth in factors of factors. 1 of those two would go to a public/state univerisity and one to a private, well-heeled, expensive university or college with preset networking. Health, education, financial backing, net-working, To make some of your points factual, you would have to have everyone at the same place. You seem to sneer at those who don't hit a home run or score in life but fail to recognize that some start out life at third base. If don't have $1,000,000 to grow in the first place, doesn't that make me stupid of lazy ? I started my own business and grew it from the ground up. If I had a 6 figure nest to invest on the onset, I would be muuuucccchhh farther. To hold most of the views you express, you would have to over simplify and omit things until it gets absurd. This triclke down economic philosophy has done nothing to help small business or working class. It has not. Class warfare has not waged from the bottom up, but from the top down and a propaganda campaign. Almost every successful society falls down this way. "Bella omnium contra omnus".

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ese 5 years, 6 months ago

It takes money to make money.The scientific side of me, as taught to me in public schools tells me that the indigent will continue to be indigent no matter how much money you give them.

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oldvet 5 years, 6 months ago

The beauty of our country is that only one person has the power to keep you poor... yourself! There are no restrictions on who can get rich, there are no limits on how much money any person can make. So if you're not making as much as you want to make, take a good look in the mirror at the person who makes the choices that hold you back. Getting ahead might mean doing things that are hard or inconvenient, it might mean taking a risk on yourself, but it is your decision and your choice. To have the government take care of you simply makes you a slave and holds you in their bondage.

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logicsound04 5 years, 6 months ago

So much ignorance, so little patience to rectify.

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b3 5 years, 6 months ago

The headline should read; "The lazy get poorer and well to do work harder."

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invictus 5 years, 6 months ago

Despite the disparity in wealth, the poor in the U.S. generally have a roof over their head, a car, a T.V., plenty to eat and free education provided through high school. What more can the government do? Provide flat screens, filet mignon, and newer model cars?

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Tom Shewmon 5 years, 6 months ago

Why does there need to be economic equality? There are winners and losers. Win/lose. It's the way of the world. Win/lose. Are we supposed to go by the post-hippie, Barney the Dinosaur, Mr. Rogers, Dr. Spock model of "everyone's special"? Poor people are special, and so are rich people. There are poor and there are wealthy. Get over it.

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invictus 5 years, 6 months ago

Equality in Denmark, Sweden and Australia.......sounds like the key is a homogenous society of Nordic/Germanic people.

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kmat 5 years, 6 months ago

I love how the republicans keep talking about how under Obama 45% won't pay income taxes. What they don't say is that 45% includes elderly who don't have income to pay taxes on and the poor that don't make enough to be taxed. 1% hold most of the wealth in this country. If it was spread out more evenly amoungst the citizens, than we'd have more people moving into the middle class and then paying taxes. It is amazing that we have so much poverty in this country that also has so much wealth.They also omit the fact that 1/3 of US corporations avoid paying taxes by having "headquarters" at a PO box on an island in the Bahamas. So, let the big corporations skip paying taxes while we tax the middle class to death. Yep, good ol' republicans looking out for middle class. And so many republicans claim to be Christians also. I think Jesus would disagree.

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Cait McKnelly 5 years, 6 months ago

The rich get richer, the poor get poorer and the middle class narrows more and more. Obama wants to "spread the wealth" and give tax cuts to the lowest 95% of income wage earners and gets called "socialist" , "Unamerican" and "anti-American". He also gets called a "Muslim", like it's a dirty word (see Colin Powell's endorsement speech) and the "N*" word (which IS a dirty word). I look at these people and wonder who is the one really being unAmerican and anti-American.

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toe 5 years, 6 months ago

This is like pointing out rain in the rain. It is obvious and the core reason the Republicans will not be in power for years.

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just_another_bozo_on_this_bus 5 years, 6 months ago

Is it any surprise? We've had nearly 30 years of Republican class warfare, which was merely slowed a tad under Clinton.

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