[News] Capitalism - The gift that just keeps on giving

[Diego Napier]

http://www.bbc.co.uk/news/business-30875633

The wealthiest 1% will soon own more than the rest of the world's population, according to a study by charity group Oxfam.
The charity's research shows that the share of the world's wealth owned by the richest 1% increased from 44% in 2009 to 48% last year.
On current trends, Oxfam says it expects the wealthiest 1% to own more than 50% of the world's wealth by 2016.
The research coincides with the start of the World Economic Forum in Davos.
The annual gathering attracts top political and business leaders from around the world, and Oxfam's executive director Winnie Byanyima, who will co-chair the Davos event, said she would use the charity's high-profile role at the gathering to demand urgent action to narrow the gap between rich and poor.
In a statement ahead of the gathering, Ms Byanyima said the scale of global inequality was "simply staggering".
"It is time our leaders took on the powerful vested interests that stand in the way of a fairer and more prosperous world.
"Business as usual for the elite isn't a cost free option - failure to tackle inequality will set the fight against poverty back decades. The poor are hurt twice by rising inequality - they get a smaller share of the economic pie and because extreme inequality hurts growth, there is less pie to be shared around," she added.
The charity is calling on governments to adopt a seven point plan to tackle inequality, including a clampdown on tax evasion by companies and the move towards a living wage for all workers.
Oxfam made headlines at Davos last year with the revelation that the 85 richest people on the planet have the same wealth as the poorest 50% (3.5 billion people).
It said that that comparison had now become even more stark, with the 80 richest people having the same wealth as the poorest 50%.
The charity said the research, published on Monday, showed that 52% of global wealth not owned by the richest 1% is owned by those in the richest 20%.
The remaining population accounts for just 5.5% of global wealth and their average wealth was $3,851 (£2,544) per adult in 2014, Oxfam found.
That compares to an average wealth of $2.7m per adult for the elite 1%.
The study comes just a day before US President Barack Obama's State of the Union address, in which he is expected to call for tax increases on the wealthy to help the middle class.
In October, a report from banking giant Credit Suisse also said that the richest 1% of people own nearly half of the world's wealth.

 

[Billy the Fish]

It's all relative. Wealth does not = happiness.

 

[8ace]

Meet The 80 People Who Are As Rich As Half The World | FiveThirtyEight

 

[Diego Napier]

It's all relative. Wealth does not = happiness.

How perceptive, that's my point exactly!

Just think how truly sad and miserable that 1% are. Oh, how they suffer on a daily basis.

 

[Moshe Gariani]

This global trend is being played out right under our noses in the UK.

Social mobility and justice have well and truly been crushed under the wheels of the capitalist juggernaut started up by Thatcher.

And people try and tell you "they're all the same"...

 

[Billy the Fish]

How perceptive, that's my point exactly!

Have you wooshed me twice in one week?!? I clearly don't have the intellect for this

 

[Flex Your Head]

So when's this due to kick in?

Marxist Economics – The Self-Destruction of Capitalism

The theory of Marxist economics maintains that capitalism eventually destroys itself as it exploits more and more people until everyone has been reduced to worker status. Engels explains the process: “Whilst the capitalist mode of production more and more completely transforms the great majority of the population into proletarians, it creates the power which, under penalty of its own destruction, is forced to accomplish this revolution. [Eventually] The proletariat seizes political power and turns the means of production into state property."

In this way, the proletariat acts as a catalyst for the downfall of capitalism and the rise of the new socialist system. “The extremely sharp class conflict between the exploiters and the exploited constitutes the basic trait of the capitalist system. The development of capitalism inevitably leads to its downfall. However, the system of exploitations does not disappear of itself. It is destroyed only as the result of the revolutionary struggle and the victory of the proletariat.”

The concept of the dialectic illustrates that the downfall of capitalism and the subsequent rise of socialism and eventually communism are inevitable. The bourgeoisie (thesis) and the proletariat (antithesis) clash to create socialism (synthesis) that guarantees the advent of communism.

 

[Hastings gull]

This global trend is being played out right under our noses in the UK.

Social mobility and justice have well and truly been crushed under the wheels of the capitalist juggernaut started up by Thatcher.

And people try and tell you "they're all the same"...

With respect, you do rather like to exaggerate. On another thread, you talk of only having 2 minutes to drink your beet at the Amex, and now this. Strangely, I rather think capitalism has done much for social mobility - it is a system which can give anyone the chance to better themselves. Of course, this does not apply to many folk, but the relative opportunity is there. When I think of East Germany, the only real way to "better yourself" was to sell your soul to the party. Has justice really been crushed? Don't you think this might just be an over-statement?

 

[jimbob5]

So when's this due to kick in?

Marxist Economics – The Self-Destruction of Capitalism

The theory of Marxist economics maintains that capitalism eventually destroys itself as it exploits more and more people until everyone has been reduced to worker status. Engels explains the process: “Whilst the capitalist mode of production more and more completely transforms the great majority of the population into proletarians, it creates the power which, under penalty of its own destruction, is forced to accomplish this revolution. [Eventually] The proletariat seizes political power and turns the means of production into state property."

In this way, the proletariat acts as a catalyst for the downfall of capitalism and the rise of the new socialist system. “The extremely sharp class conflict between the exploiters and the exploited constitutes the basic trait of the capitalist system. The development of capitalism inevitably leads to its downfall. However, the system of exploitations does not disappear of itself. It is destroyed only as the result of the revolutionary struggle and the victory of the proletariat.”

The concept of the dialectic illustrates that the downfall of capitalism and the subsequent rise of socialism and eventually communism are inevitable. The bourgeoisie (thesis) and the proletariat (antithesis) clash to create socialism (synthesis) that guarantees the advent of communism.

wot he's sayin is that when all de rich peeps are able to use dat wealth to get even wealthier and keep it in the family and more and more peeps see they are missin out on all dat wealth being created, there's likely to a massive ruck.

 

[Moshe Gariani]

With respect, you do rather like to exaggerate. On another thread, you talk of only having 2 minutes to drink your beer at the Amex, and now this. Strangely, I rather think capitalism has done much for social mobility - it is a system which can give anyone the chance to better themselves. Of course, this does not apply to many folk, but the relative opportunity is there. When I think of East Germany, the only real way to "better yourself" was to sell your soul to the party. Has justice really been crushed? Don't you think this might just be an over-statement?

Not really. To invoke 1970s East Germany is rather to miss the point.

Social justice has declined steadily in the UK from its 1960s peak and the current acceleration of this trend should be alarming to all but the staunchest of right-wingers.

 

[Hastings gull]

Not really. To invoke 1970s East Germany is rather to miss the point.

Social justice has declined steadily in the UK from its 1960s peak and the current acceleration of this trend should be alarming to all but the staunchest of right-wingers.

Thank you. I read it to be social mobility, and justice, where as you meant it to be social justice. My fault. Can you be rather more specific -the above is lovely slogan (no offence meant) but what actual meaning does it have?

 

[Buzzer]

Beware Oxfam's dodgy statistics on wealth inequality

Oxfam’s claim that the richest 1 per cent own 48 per cent of the world’s wealth (and will soon own more than half) rests on Credit Suisse data. This data is on net wealth, which throws up all sorts of weird findings when you try to add it up across large populations. That is because net wealth is calculated by adding up the value of assets and taking off debts. To see this, look at the figure below from the Credit Suisse report. If we were to split up the data into deciles, this methodology would suggest China has no people in the bottom 10 per cent – the world’s poorest – with most Chinese in the top 50 per cent. North America on the other hand supposedly has around 8 per cent of the world’s poorest population – because significant numbers of people in the States are loaded up with debts of various kind, making their net wealth negative!


According to this methodology, the poorest 2 billion people in the world have a negative net wealth. Someone who has 50p but no assets or debts would be above the bottom 30 per cent of the world’s population. It doesn’t take an advanced mathematician to work out that adding up lots of negatives at the bottom to an overall wealth share figure for the bottom 99 per cent will of course make that figure much smaller than a gross wealth figure. Oxfam has then taken this bogus figure, looked at recent trends (which show the share of the top 1 per cent rising) and simply extrapolated into the future to get their headline (which seems a huge assumption given the potential QE unwinding).

Aggregating net wealth figures is largely meaningless and not the way most people think about poverty, or indeed the ‘rich’. That Oxfam has been able to claim front pages with a nonsensical ‘report’ throws up all sorts of worrying questions about journalistic standards. But the more perturbing fact is that Oxfam’s latest meme will now be repeated ad nauseam by those who won’t examine the basis of the claim.

 

[glasfryn]

and the food banks keep growing in size and number
"we are all in this together"..............really?

 

[beorhthelm]

yes it keeps giving - wealth increases and everyone is getting a little bit more wealthy. no mention of this though, just a focus on who owns the wealth, with no context to what defines and constitutes that wealth.

 

[symyjym]

Capitalism always looks like someone is shouting

 

[Kuipers Supporters Club]

Someone provide me with an alternative, where you get democracy to.

 

[Buzzer]

And just to add according to the UN's 'Millenium Development Goal" of halving extreme poverty between 1990 and 2015 has been achieved well ahead of schedule: Extreme poverty GLOBALLY is falling faster than ever. 36% of the world's population fell into this bracket in 1990, by 2011 it was 15%. and elsewhere on every single one of the WHO and UN's measures the people at the bottom of the income scale are doing better: longevity, literacy, infant mortality, calorie intake, height.

A lot of economists at the UN and WHO are putting a big factor down to the old socialist countries (incl China) joining the global trading system. Meanwhile, compare and contrast these burgeoning economies, including many in Africa, with those neo-Socialist economies such as Venezuela where an extremely oil-rich country is on its knees, there are queues for the most basic food items and wealth disparity is growing faster than in those embracing a free market. In fact the only people who have got richer under their quasi-Marxist government are the apparatchiks and friends of those in power. And that's just the economy. We've not even started on the social injustices and removal of liberties that their government deem are necessary to prop up yet another failed left-wing Government. http://www.bloomberg.com/news/2014-...riends-rich-after-his-death-amid-poverty.html

Capitalism may not be a universal panacea but it sure as hell is a lot fairer than any of the alternatives around.

 

[Moshe Gariani]

[/B]

Thank you. I read it to be social mobility, and justice, where as you meant it to be social justice. My fault. Can you be rather more specific -the above is lovely slogan (no offence meant) but what actual meaning does it have?

It means the view that "everyone deserves equal economic, political and social rights and opportunities" has an alarmingly low level of influence in 2015 Britain and the trend seems to be in one direction.

If you look you see it all around you.

Just one easy example. In Eastbourne where I live we have a new government funded "Free School" which is transparently just an excuse to create an exclusive place of privilege for those who can afford to live in its affluent catchment area. How on earth can that be justified? It can't be justified, but it happens because the people with unequal economic, political and social power want to perpetuate unequal opportunity for their next generation.

 

[Machiavelli]

Beware Oxfam's dodgy statistics on wealth inequality

Oxfam’s claim that the richest 1 per cent own 48 per cent of the world’s wealth (and will soon own more than half) rests on Credit Suisse data. This data is on net wealth, which throws up all sorts of weird findings when you try to add it up across large populations. That is because net wealth is calculated by adding up the value of assets and taking off debts. To see this, look at the figure below from the Credit Suisse report. If we were to split up the data into deciles, this methodology would suggest China has no people in the bottom 10 per cent – the world’s poorest – with most Chinese in the top 50 per cent. North America on the other hand supposedly has around 8 per cent of the world’s poorest population – because significant numbers of people in the States are loaded up with debts of various kind, making their net wealth negative!


According to this methodology, the poorest 2 billion people in the world have a negative net wealth. Someone who has 50p but no assets or debts would be above the bottom 30 per cent of the world’s population. It doesn’t take an advanced mathematician to work out that adding up lots of negatives at the bottom to an overall wealth share figure for the bottom 99 per cent will of course make that figure much smaller than a gross wealth figure. Oxfam has then taken this bogus figure, looked at recent trends (which show the share of the top 1 per cent rising) and simply extrapolated into the future to get their headline (which seems a huge assumption given the potential QE unwinding).

Aggregating net wealth figures is largely meaningless and not the way most people think about poverty, or indeed the ‘rich’. That Oxfam has been able to claim front pages with a nonsensical ‘report’ throws up all sorts of worrying questions about journalistic standards. But the more perturbing fact is that Oxfam’s latest meme will now be repeated ad nauseam by those who won’t examine the basis of the claim.

The IEA or Oxfam? There's problems with both, but let's see if we can work out which has the larger problems.

 

[Machiavelli]

Capitalism may not be a universal panacea but it sure as hell is a lot fairer than any of the alternatives around.

There are various incarnations of capitalism. One that compromised with social democracy, and was the governing logic from post-war to the 1970s (and it was a logic that One Nation Tories accommodated and pursued during this period). Another that is the subsequent governing logic, namely neoliberalism. My point is that the former is better than the latter.
And there are two clear reasons for that reduction in poverty. The first is China which, again, is some sort of composite, rather than one ruled fundamentally by free market logic. The second is that they've completely changed the rules of how they calculate poverty in the interim period, to present it in a better light. Check out Thomas Pogge's recent work on this, which is extremely compelling.