A global super-rich elite has exploited gaps in cross-border tax rules to hide an extraordinary £13 trillion ($21tn) of wealth offshore... for many developing countries the cumulative value of the capital that has flowed out of their economies since the 1970s would be more than enough to pay off their debts to the rest of the world...
...almost £500bn has left Russia since the early 1990s when its economy was opened up. Saudi Arabia has seen £197bn flood out since the mid-1970s, and Nigeria £196bn...
The sheer size of the cash pile sitting out of reach of tax authorities is so great that it suggests standard measures of inequality radically underestimate the true gap between rich and poor. According to Henry's calculations, £6.3tn of assets is owned by only 92,000 people, or 0.001% of the world's population...
"These estimates reveal a staggering failure: inequality is much, much worse than official statistics show, but politicians are still relying on trickle-down to transfer wealth to poorer people...."
22 July 2012
The 0.001%
From an article in The Guardian, not really "news" per se, but some startling numbers:
Why do people trouble themselves with what others have? This is a sin. Servants are to serve their masters and rewards will come after death. Trust me.
ReplyDeleteWillard? Is that you?
Deletelol I can't tell if this is tongue-in-cheek or not, since there are a lot of boneheads who really think and believe this way.
DeleteThe fundamental flaw in that argument is that "politicians" are usually based in a specific country and the "global super rich elite" is not.
ReplyDeleteTrickle-down as a concept is not proven wrong for say poland, when there is a super rich elite from russia and the emirates.
Also it is useless to accumulate national wealth to a global total wealth and the talk about tne 0,001 percent. The wealthh of a rich italian is total irrelevant to the poorest one billion indians. And the rise of hundreds of millions of chinese has not hurt the wealth of the hundred richest canadiens.
One should not mix national politics (rich, poor, trickle-down) with the most superficial of statistics...
Instead of drawing simplicistic conclusions one should target those gaps in the tax rules. But that, I guess, is too complicated and doesn't work up coters enough to rally them to the urns...
I disagree. The rising middle class in China is directly connected to the Chess game of relocating the supply channels. NAFTA was created and almost immediately China manufacturing found channels through mexico into the USA and Canada. Instead of killing or fixing NAFTA, their was too much money to be had from the sweatshops overseas so the US threw up their hands and cut out the middlemen. Yay freedom.
DeleteAs for the billion poor in India, do you realize how many billions there are in a trillion? I realize that simply redistributing the wealth would only lead to more babies and more famine but do not kid yourself that the global economy(ies) are little more than games of Chess between financial titans.
Anonymous,
DeleteI want only to add the point that simple distribution of wealth does lead to increase in population, but better education of the women is consistently related to a decrease in fertility. So it's a matter of how you spend the money.
Yes! education, birth control, and self defense courses.
DeleteThe wealth of a rich Italians may be totally irrelevant to the poorest Indians, but it's definitely relevant to the poorest Italians. Likewise, that so much money has left Nigeria is of serious concern to the Nigerians...
ReplyDeleteAccording to Immanuel Wallerstein, when Adam Smith said there was an "invisible hand" that could avoid capital flight from the United Kingdom, he wasn't predicting a world as interconected as ours... For me, it is very clear that the wealth of rich italians is completely relevant to the poorest indians.
ReplyDeleteSince 2006, food prices are hiking around the world. It is becoming a hardly financialized asset, for export and internal consumption. (By the way, the so called "austerity measures" taken by wealthy nations include cuts to humanitarian aid). And now, the money that goes to food and nature resource providing countries, like India, is mostly from heavy investors from wealthy countries, that took at that time their money away from the toxic investment vehicles, before the crash.
Since 2008, when the major european and north-american banks were bailed out, another bubble started in developing countries: housing. Between jan 2010 and jan 2011, the total offer of credit for mortgage here in Brazil doubled. Now, the major systemic risk in these economies is the flight of capital: if the world economy sneezes and investors turn to liquidity, there will be no solvency anywhere in Latin America, with the exception of the socialist countries, that are on recession now.