Income Inequality Media Articles
Below are key excerpts of revealing news articles on income inequality from reliable news media sources. If any link fails to function, a paywall blocks full access, or the article is no longer available, try these digital tools.
The number of chronically hungry people in the world dipped considerably below the 1 billion mark - the first drop in 15 years - thanks partly to a fall in food prices after spikes that sparked rioting a few years ago, U.N. agencies said [on September 14]. Still, an estimated 925 million people are undernourished worldwide, and the latest figures don't reflect the repercussions from the massive flooding in Pakistan. The Rome-based Food and Agriculture Organization's report suggested some progress in the battle to end hunger, but stressed the world is far from achieving the U.N. promoted Millennium Development Goal of halving the proportion of undernourished people from 20 percent in 1990-92 to 10 percent in 2015. The report estimated there are 98 million fewer chronically hungry people than in 2009, when the figure just topped 1 billion. The drop in the chronically hungry is partly because ... cereal and rice harvests have been strong. Cereal production this year was the third-highest ever recorded, despite a drought-fueled wheat shortfall in Russia, said FAO director-general Jacques Diouf. Also heartening, Diouf noted, is that cereal stocks are high - some 100 million tons more than the low levels of 2007-2008, when some 38 countries shut down their food export markets in reaction.
"The Conehead economy" [is] the idea that if the economy were a person, its growth over the past few decades would've turned it from a normal-looking individual into a conehead. Jacob Hacker and Paul Pierson get at this idea slightly differently [in their book Winner-Take-All Politics]. They've got a table showing how incomes would look if growth had been equally shared from 1979 to 2006 -- much as it was in the decades before 1979. If growth had been equally shared, the middle quintile would be making $64,395 today. Instead, they're making $52,100. That's a 23 percent raise those folks didn't get -- and that I'm sure they would've noticed. The top 1 percent ... made, on average, $1,200,300 in 2006. If growth had been equally shared in the three decades before that, however, their incomes would've been cut by more than half, down to $506,002. That's real, serious money we're talking about. The top 1 percent now accounts for 23.5 percent of the national income if you include capital gains. In 1979, they only had 9.8 percent of the nation's earnings. During that same period, tax rates on the richest Americans have actually dropped. So as the economy went one way -- toward more money going to the rich -- the tax system went the other.
Note: For lots more on income inequality from reliable sources, click here.
Thousands of foreign domestic workers are living as slaves in Britain, being abused sexually, physically and psychologically by employers. More than 15,000 migrant workers come to Britain every year to earn money to send back to their families. Many endure conditions that campaigners say amount to modern-day slavery. Kalayaan, a charity based in west London that helps and advises migrant domestic workers, registers around 350 new workers each year. About 20% report being physically abused or assaulted, including being burnt with irons, threatened with knives, and having boiling water thrown at them. "Two-thirds of the domestic workers we see report being psychologically abused," said Jenny Moss, a community advocate for the charity. "That means they've been threatened and humiliated, shouted at constantly and called dog, donkey, stupid, illiterate." A similar proportion say they were not allowed out alone and have never had a day off. Nearly three-quarters say they were paid less than 50 a week. "The first thing to understand when we're talking about slavery is that we're not using a metaphor," said Aidan McQuade from Anti-Slavery International. "Many of the instances of domestic servitude we find in this country are forced labour a classification that includes retention of passports and wages, threat of denunciation and restriction of movement and isolation."
Note: This phenomenon also happens in big cities in the US much more than people might suspect.
Missing from almost all discussion of Americas dizzying rate of unemployment is the brute fact that hourly wages of people with jobs have been dropping, adjusted for inflation. Average weekly earnings rose a bit this spring only because the typical worker put in more hours, but Junes decline in average hours pushed weekly paychecks down at an annualized rate of 4.5 percent. In other words, Americans are keeping their jobs or finding new ones only by accepting lower wages. Meanwhile, a much smaller group of Americans earnings are back in the stratosphere: Wall Street traders and executives, hedge-fund and private-equity fund managers, and top corporate executives. As hiring has picked up on the Street, fat salaries are reappearing. Were back to the same ominous trend as before the Great Recession: a larger and larger share of total income going to the very top while the vast middle class continues to lose ground. And as long as this trend continues, we cant get out of the shadow of the Great Recession. When most of the gains from economic growth go to a small sliver of Americans at the top, the rest dont have enough purchasing power to buy what the economy is capable of producing.
Note: The author of this analysis, Robert Reich, is a former U.S. Secretary of Labor. For highly informative graphs showing the details of rising wealth inequality in the United States, click here.
G.D.P. is an index of a countrys entire economic output a tally of, among many other things, manufacturers shipments, farmers harvests, retail sales and construction spending. Its a figure that compresses the immensity of a national economy into a single data point of surpassing density. The conventional feeling about G.D.P. is that the more it grows, the better a country and its citizens are doing. [But] it has been a difficult few years for G.D.P. For decades, academics and gadflies have been critical of the measure, suggesting that it is an inaccurate and misleading gauge of prosperity. What has changed more recently is that G.D.P. has been actively challenged by a variety of world leaders, especially in Europe, as well as by a number of international groups, like the Organization for Economic Cooperation and Development. The G.D.P. ... has not only failed to capture the well-being of a 21st-century society but has also skewed global political objectives toward the single-minded pursuit of economic growth. Which indicators are the most suitable replacements for, or most suitable enhancements to, G.D.P. Should they measure educational attainment or employment? Should they account for carbon emissions or happiness?
Note: Which is more important, the economic prosperity of a people, or the well being and level of happiness?
Some of the world's biggest, most profitable corporations enjoy a far lower tax rate than you do – that is, if they pay taxes at all. The most egregious example is General Electric. Last year the conglomerate generated $10.3 billion in pretax income, but ended up owing nothing to Uncle Sam. In fact, it recorded a tax benefit of $1.1 billion. How did this happen? It's complicated. GE in effect consists of two divisions: General Electric Capital and everything else. The everything else – maker of engines, power plants, TV shows and the like – would have paid a 22% tax rate if it was a standalone company. It's GE Capital that keeps the overall tax bill so low. Over the last two years, GE Capital has displayed an uncanny ability to lose lots of money in the U.S. (posting a $6.5 billion loss in 2009), and make lots of money overseas (a $4.3 billion gain). Not only do the U.S. losses balance out the overseas gains, but GE can defer taxes on that overseas income indefinitely. It's the tax benefit of overseas operations that is the biggest reason why multinationals end up with lower tax rates than the rest of us.
Note: Forbes later changed the title of this article to a more innocuous "What The Top U.S. Companies Pay In Taxes." Can you believe that GE not only pays no taxes, they actually get credit from the US government? They ship US jobs overseas and then reap huge tax benefits as a result. What's wrong with this picture? For a wealth of media news articles on the hidden manipulations of major financial corporations, click here.
Economists warn that Britain is wobbling on a tightrope over a second recession where spending cuts would precipitate more unemployment and risk sinking the economy into a downward spiral. So far Labour has failed to find the words to express public outrage at the financiers' billowing wealth while the Treasury is drained. Only weeks since launching, the campaign for a Robin Hood tax on all financial transactions has gathered extraordinary support. It hasn't been hard, so profound is the untapped public anger at the bankers. This week the European parliament voted for it overwhelmingly 536 to 80 supported by the social democrats and the majority conservative EPP grouping: opponents were the ECP rump rightwingers the Tories belong to. Backed here by some 100 organisations from Oxfam to the Salvation Army, rarely has a campaign gathered such momentum in so short a time: 140,000 have joined and more gather by the day. Campaigners want a sterling transaction tax to come in at once. Imposing just 0.005% on every sterling deal is within Britain's sole control, raising 4bn. If the EU agrees a wider financial transactions tax, it would bring Britain another 4bn one estimate is 100bn across Europe, to be used at home, in foreign aid and on climate change.
Note: See http://robinhoodtax.org.uk to support this rapidly growing movement which may make a big difference.
The [IRS] reports that the nation's 400 highest-earning households reported an average income of $345 million in 2007 up 31% from 2006 and that their average tax bill fell to a 15-year low. Bloomberg writes that the elite 400's average income more than doubled that year from $131.1 million in 2001, the year Congress adopted tax cuts urged by then-President George W. Bush. Each household in the top 400 of earners paid an average tax rate of 16.6 percent, the lowest since the agency began tracking the data in 1992. Their average effective tax rate was about half the 29.4 percent in 1993, the first year of President Bill Clinton's administration. The top 400 earners received a total $138 billion in 2007, up from $105.3 billion a year earlier. On an inflation-adjusted basis, their average income grew almost fivefold since 1992. Almost three-quarters of the highest earners' income was in capital gains and dividends taxed at a 15 percent rate set as part of Bush-backed tax cuts in 2003.
Note: For key reports from major media sources on income inequality, click here. And for a powerful summary of 10 top corporations which avoided taxes in most egregious ways, see the excellent list compiled by independent U.S. Senator Bernie Sanders at this link.
The 400 highest-earning U.S. households reported an average of $345 million in income in 2007, up 31 percent from a year earlier, IRS statistics show. The average tax rate for the households fell to the lowest in almost 20 years. The figures for 2007, the last year of an economic expansion, show that the average income reported by the top 400 earners more than doubled from $131.1 million in 2001. That year, Congress adopted tax cuts urged by then-President George W. Bush that Democrats say disproportionately benefit the wealthy. Each household in the top 400 of earners paid an average tax rate of 16.6 percent, the lowest since the agency began tracking the data in 1992. The statistics underscore two long-term trends: that income at the very top has exploded and their taxes have been cut dramatically, said Chuck Marr, director of federal tax policy at the Center on Budget and Policy Priorities, a Washington-based research group that supports increasing taxes on high-income individuals. The top 400 earners received a total $138 billion in 2007, up from $105.3 billion a year earlier. On an inflation-adjusted basis, their average income grew almost fivefold since 1992.
Note: BusinessWeek for some reason removed this article, though it is still available on the Bloomberg website at this link. For lots more on income inequality from reliable sources, click here.
Nearly one in five U.S. households ran out of money to buy enough food at least once during 2009, said an antihunger group ... urging more federal action to help Americans get enough to eat. "There are no hunger-free areas of America," said Jim Weill of the Food Research and Action Center. Nationwide polling found 18.2 percent of households reported "food hardship" -- lacking money to buy enough food -- in 2009, according to the group. That is higher than the government's "food insecurity" rating of 14.6 percent of households, or 49 million people, for 2008. Households with children had a "food hardship" rate of 24.1 percent for 2009 compared with 14.9 percent among households without children. Twenty states had rates of 20 percent or higher. Seven Southern states led the list. The figures were based on responses to the question, "Have there been times in the past 12 months when you did not have enough money to buy the food that you or your family needed?" The question is similar to one asked by the Census Bureau in collecting data for the annual food-insecurity report.
Note: For much more from reliable sources on growing income inequality, click here. For more on the impacts of the financial crisis and its economic impacts leading to the Great Recession, click here.
About six million Americans receiving food stamps report they have no other income, according to an analysis of state data collected by The New York Times. In declarations that states verify and the federal government audits, they described themselves as unemployed and receiving no cash aid — no welfare, no unemployment insurance, and no pensions, child support or disability pay. Their numbers were rising before the recession as tougher welfare laws made it harder for poor people to get cash aid, but they have soared by about 50 percent over the past two years. About one in 50 Americans now lives in a household with a reported income that consists of nothing but a food-stamp card. Members of this straitened group range from displaced strivers ... to weathered men who sleep in shelters and barter cigarettes. Some draw on savings or sporadic under-the-table jobs. Some move in with relatives. Some get noncash help, like subsidized apartments. While some go without cash incomes only briefly before securing jobs or aid, others rely on food stamps alone for many months. The surge in this precarious way of life has been so swift that few policy makers have noticed. But it attests to the growing role of food stamps within the safety net. One in eight Americans now receives food stamps, including one in four children.
Note: For revealing reports from major media sources on increasing income inequality, click here.
For most of the past 70 years, the U.S. economy has grown at a steady clip, generating perpetually higher incomes and wealth for American households. But since 2000, the story is starkly different. The past decade was the worst for the U.S. economy in modern times, a sharp reversal from a long period of prosperity. It was, according to a wide range of data, a lost decade for American workers. The decade began in a moment of triumphalism -- there was a current of thought among economists in 1999 that recessions were a thing of the past. By the end, there were two, bookends to a debt-driven expansion that was neither robust nor sustainable. There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent. Economic output rose at its slowest rate of any decade since the 1930s as well. Middle-income households made less in 2008, when adjusted for inflation, than they did in 1999 -- and the number is sure to have declined further during a difficult 2009. The Aughts were the first decade of falling median incomes since figures were first compiled in the 1960s. And the net worth of American households ... has also declined when adjusted for inflation, compared with sharp gains in every previous decade since data were initially collected in the 1950s.
Note: For revealing reports from major media sources on the realities of the economic crisis, click here.
New federally financed drug research reveals a stark disparity: children covered by Medicaid are given powerful antipsychotic medicines at a rate four times higher than children whose parents have private insurance. And the Medicaid children are more likely to receive the drugs for less severe conditions than their middle-class counterparts, the data shows. Those findings, by a team from Rutgers and Columbia, are almost certain to add fuel to a long-running debate. Do too many children from poor families receive powerful psychiatric drugs not because they actually need them but because it is deemed the most efficient and cost-effective way to control problems that may be handled much differently for middle-class children? The questions go beyond the psychological impact on Medicaid children, serious as that may be. Antipsychotic drugs can also have severe physical side effects, causing drastic weight gain and metabolic changes resulting in lifelong physical problems. Part of the reason is insurance reimbursements, as Medicaid often pays much less for counseling and therapy than private insurers do. Studies have found that children in low-income families may have a higher rate of mental health problems perhaps two to one compared with children in better-off families. But that still does not explain the four-to-one disparity in prescribing antipsychotics.
Note: For many important health reports from reliable sources, click here.
Patients who lack health insurance are more likely to die from car accidents and other traumatic injuries than people who belong to a health plan -- even though emergency rooms are required to care for all comers regardless of ability to pay. An analysis of 687,091 patients who visited trauma centers nationwide from 2002 to 2006 found that the odds of dying from injuries were almost twice as high for the uninsured than for patients with private insurance, researchers reported in Archives of Surgery. The research team from Harvard University and Brigham and Women's Hospital in Boston used information from 1,154 U.S. hospitals that contribute to the National Trauma Data Bank. The risk of death was 80% higher for patients without any insurance, the report said. The researchers also did a separate analysis of 209,702 trauma patients ages 18 to 30 because they were less likely to have chronic health conditions that might complicate recovery. Among these younger patients, the risk of death was 89% higher for the uninsured, the study found.
Note: For many highly informative reports on important health issues, click here.
The incomes of the young and middle-aged especially men have fallen off a cliff since 2000, leaving many age groups poorer than they were even in the 1970s, a USA TODAY analysis of new Census data found. People 54 or younger are losing ground financially at an unprecedented rate in this recession, widening a gap between young and old that had been expanding for years. The dividing line between those getting richer or poorer: the year 1955. If you were born before that, you're part of a generation enjoying a four-decade run of historic income growth. Every generation after that is now sinking economically. Household income for people in their peak earning years between ages 45 and 54 plunged $7,700 to $64,349 from 2000 through 2008, after adjusting for inflation. People in their 20s and 30s suffered similar drops. Older people enjoyed all the gains. The line between the haves and have-nots runs through the middle of the Baby Boom, the population explosion 1946-64. "The second half of the Baby Boom may be in the worst shape of all," says demographer Cheryl Russell of New Strategist Publications, a research firm. "They're loaded with expenses for housing, cars and kids, but they will never generate the income that their parents enjoyed."
Note: For lots more on income inequality from reliable sources, click here.
The rich have been getting richer for so long that the trend has come to seem almost permanent. They began to pull away from everyone else in the 1970s. By 2006, income was more concentrated at the top than it had been since the late 1920s. The recent news about resurgent Wall Street pay has seemed to suggest that not even the Great Recession could reverse the rise in income inequality. But economists say and data is beginning to show that a significant change may in fact be under way. The rich, as a group, are no longer getting richer. Over the last two years, they have become poorer. And many may not return to their old levels of wealth and income anytime soon. Last year, the number of Americans with a net worth of at least $30 million dropped 24 percent. Few economists expect the country to return to the relatively flat income distribution of the 1950s and 1960s. Indeed, they say that inequality is likely to remain significantly greater than it was for most of the 20th century. In 2007, the top one ten-thousandth of households took home 6 percent of the nations income, up from 0.9 percent in 1977. It was the highest such level since at least 1913, the first year for which the I.R.S. has data. The top 1 percent of earners took home 23.5 percent of income, up from 9 percent three decades earlier.
Note: Two researchers into income inequality, Emmanuel Saez and Thomas Piketty, recently released a detailed report showing that income inequality in 2007, just before the real estate bubble burst and the financial crisis unfolded, was the highest since 1917. To read their report, "Striking it Richer: The Evolution of Top Incomes in the United States," click here. For analysis of the report, click here.
The acquisition of farmland from the world's poor by rich countries and international corporations is accelerating at an alarming rate, with an area half the size of Europe's farmland targeted in the last six months, reports from UN officials and agriculture experts say. New reports from the UN and analysts in India, Washington and London estimate that at least 30m hectares is being acquired to grow food for countries such as China and the Gulf states who cannot produce enough for their populations. According to the UN, the trend is accelerating and could severely impair the ability of poor countries to feed themselves. Olivier De Schutter, special envoy for food at the UN Office of the High Commissioner for Human Rights, said: "[The trend] is accelerating quickly. All countries observe each other and when one sees others buying land it does the same." Nearly 20m hectares (50m acres) of farmland an area roughly half the size of all arable land in Europe has been sold or has been negotiated for sale or lease in the last six months. Around 10m hectares was bought last year. Some of the largest deals include South Korea's acquisition of 700,000ha in Sudan, and Saudi Arabia's purchase of 500,000ha in Tanzania. The Democratic Republic of the Congo expects to shortly conclude an 8m-hectare deal with a group of South African businesses to grow maize and soya beans as well as poultry and dairy farming. India has lent money to 80 companies to buy 350,000ha in Africa. De Schutter said that after the food crisis of 2008, many countries found food imports hit their balance of payments, "so now they want to insure themselves. This is speculation, betting on future prices. What we see now is that countries have lost trust in the international market. We know volatility will increase in the next few years. Land prices will continue to rise."
Note: This important article makes the key point that speculation is driving this "new land grab" or "neo-colonial" activity by nations. After the collapse of the bubble in financial instruments speculative activity by the biggest players is moving into commodities of all kinds, even land in places where it can be bought cheaply and bid up high. For lots more about predatory capital flows from major media sources, click here.
If companies don't ... focus on "internal equity" – how the highest paid executive's pay compares with that of everyone else in the organization – they risk losing their own staff's dedication and focus. Indeed, a bias to focus only on the external market in recent years has helped push executive compensation way out of whack. Because of the yawning gap between the leaders and the led, employee morale is suffering, talented performers' loyalty is evaporating, and strategy and execution is suffering at American companies. A smaller gap makes for greater solidarity, and as a result better performance, throughout the workplace. At Whole Foods, we've made adjustments to keep the external and internal equity perspectives in balance. We have a salary cap – the maximum allowable ratio of the highest cash compensation to average employee cash compensation. Today it's 19 to 1. The maximum cash compensation anyone can make at Whole Foods at about $650,000. Whole Foods has never lost to a competitor a top executive that we wanted to keep since the company began more than 30 years ago. The truth is that maximizing personal compensation is not the only motivation that people have in their work. We discover that once our basic material needs are satisfied, money becomes less important to us. In my experience, deeper purpose, personal growth, self-actualization, and caring relationships provide very powerful motivations and are more important than financial compensation for creating both loyalty and a high performing organization.
Note: This article was written by the CEO of Whole Foods, John Mackey. For more along these lines, see concise summaries of deeply revealing news articles on income inequality from reliable major media sources.
When Jody Richards saw a homeless man begging outside a downtown McDonald's recently, he bought the man a cheeseburger. There's nothing unusual about that, except that Richards is homeless, too, and the 99-cent cheeseburger was an outsize chunk of the $9.50 he'd earned that day panhandling. The generosity of poor people isn't so much rare as rarely noticed, however. In fact, the nation's poor donate more, in percentage terms, than higher-income groups do, surveys of charitable giving show. What's more, their generosity declines less in hard times than the generosity of richer givers does. "The lowest-income fifth [of the population] always give at more than their capacity," said Virginia Hodgkinson, former vice president for research at Independent Sector, a Washington, D.C.-based association of nonprofit agencies. "The next two-fifths give at capacity, and those above that are capable of giving two or three times more than they give." The Bureau of Labor Statistics' latest survey of consumer expenditure found that the poorest fifth of U.S. households contributed an average of 4.3 percent of their incomes to charitable organizations in 2007. The richest fifth gave at less than half that rate, 2.1 percent. The figures probably undercount remittances by legal and illegal immigrants to family and friends back home, a multibillion-dollar outlay to which the poor contribute disproportionally. None of the middle fifths of U.S. households, in contrast, gave away as much as 3 percent of their incomes. What makes poor people's generosity even more impressive is that their giving generally isn't tax deductible, because they don't earn enough to itemize their charitable tax deductions.
When capitalism seemed on the verge of collapse last fall, Kristin Halvorsen, Norways Socialist finance minister and a longtime free market skeptic, did more than crow. As investors the world over sold in a panic, she bucked the tide, authorizing Norways $300 billion sovereign wealth fund to ramp up its stock buying program by $60 billion or about 23 percent of Norway's economic output. "The timing was not that bad," Ms. Halvorsen said, smiling with satisfaction over the broad worldwide market rally that began in early March. The global financial crisis has brought low the economies of just about every country on earth. But not Norway. With a quirky contrariness as deeply etched in the national character as the fjords carved into its rugged landscape, Norway has thrived by going its own way. When others splurged, it saved. When others sought to limit the role of government, Norway strengthened its cradle-to-grave welfare state. And in the midst of the worst global downturn since the Depression, Norways economy grew last year by just under 3 percent. The government enjoys a budget surplus of 11 percent. Norway is a relatively small country with a ... population of 4.6 million and the advantages of being a major oil exporter. Even though prices have sharply declined, the government is not particularly worried. That is because Norway avoided the usual trap that plagues many energy-rich countries. Instead of spending its riches lavishly, it passed legislation ensuring that oil revenue went straight into its sovereign wealth fund, state money that is used to make investments around the world. Now its sovereign wealth fund is close to being the largest in the world.
Note: For lots more on the global economic and financial crisis from reliable sources, click here.
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