OK

  There is a pretty damning article in today's Financial Times, probably the planet's leading English language business daily. The upshot: unless we spark a major revolution, the majority of the world people are truly screwed.

   Here is the lead paragraph:

Nearly three years after the start of the economic crisis, a new spectre is haunting the world’s most advanced economies: the prospect that the majority of their citizens will face years of stagnant wages. [emphasis added]

   Why? No surprise, really, but the FT is refreshingly honest and succinct:

Growth in per capita national income must go somewhere. In the US, the money flowed almost exclusively to the very richest. The earnings of US individuals with pre-tax income in the top 1 per cent accounted for 8 per cent of total in 1974, but rocketed to 18 per cent by 2008, according to the world top incomes database, a resource compiled from tax return data. Even larger proportionate rises in the share of income went to the top 1 per cent of those with incomes within the 1 top per cent.

But rising inequality in recent years is far from a US phenomenon. The Organisation for Economic Co-operation and Development found increasing income inequality between the mid 1980s and late 2000s in 17 out of 22 advanced economies, for which it had sufficient data. “There are signs that levels [of inequality] may be converging at a common and higher average,” the OECD said in a recent report and “countries such as Denmark, Germany and Sweden, which have traditionally had low inequality, are no longer spared from the rising inequality trend”.[emphasis added]

    The take away here is this: the world's wealth has expanded dramatically but the system has diverted that wealth into the hands of a few.

    The FT piece does not dig into other trends--for example, the folly of a global trade policy that drives down wages. Or the attack on unions.

    But, the message is pretty clear: the political system is exacerbating the divide.

Originally posted to Tasini on Mon Jun 27, 2011 at 11:56 AM PDT.

Also republished by Job Party, Jobs Wages and Community Investment Working Group, In Support of Labor and Unions, and Income Inequality Kos.

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