MIDDLE CLASS GROWTH PARTY TO REDUCE INEQUALITY
PARTIES = Business as usual = Expanding foreign trade + Expanding employment with Trickle Down
FACT: The whole world including International Economic Institutions + EVEN DAVOS = Say the greatest CRISIS facing NATIONS is Inequality + Disparity = Oxfam Report + UNDP Report titled “Humanity Divided” (2013)
Evidence Show that, “increases in inequality over the last two decades were mainly on account of trade and financial globalization processes that weakened the bargaining position of relatively immobile labor versus fully mobile capital.”
Report by UN = ‘Inequality Matters: Report of the World Social Situation 2013’ = presents data on the increase in inequality and wealth globally
“In addition to inhibiting economic growth over time, inequality can also generate greater market volatility and instability.”
— Report by UN = “Inequality Matters” – due to the generation of finance-driven business cycles.
Inequality = Economic Recession = Great Depression (1930s) + 2008 Great Recession
Increases in income and wealth inequality = Rapid rise in debt-to-income ratios among lower and middle-income households.
Higher Inequality = Lower GDP growth = Need for Reform of Policies
Striking increases in income/wealth inequality = Brings down the economy = Unjust and Abhorrent
Oxfam 2014 Briefing paper “Working for the Few: political Capture and Economic Inequality”
FACT: Deep inequalities = Few control Economy = Policy Decisions support their interests = Persistence of Poverty
Little Schemes to help the poor = USELESS if Few in economic power Increase Real Inequality
SOLUTION: “Wage growth seen as a major source of aggregate demand that propels economic recovery in slumps, and generates conditions for stable growth to create jobs.” Broad-based employment generates demand for goods/services to propel the economy = Especially the manufacturing sector and the agricultural sector.
Source: 2010 UNCTAD report “Trade and Development Report 2010: Employment, globalization and Development”
High Inequality + Trade-led growth = Limits productive capacity of US economy & JOBS
China woke up Inequality = Massive drive to provide secure jobs to generate domestic demand.
Inequality in income and wealth in USA #1 in Both = Grown = FEW HUNDRED MORE BILLIONAIRES + 10s of MILLIONS MORE POOR = Striking share of wealth by FEW
WAKE-UP CALL for those designing the FUTURE Economy = TAX POLICY FOR JOBS
IMF’s Lagarde has warned = Perpetuation of high inequality damages the political fabric