Income Inequality News 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.
In the world of thoroughbred racing, the ruler of Dubai, Sheikh Mohamed, has spared no expense in making himself a big man. The sheikh's taking the same no expense spared approach to promoting Dubai around the world. Prominent figures, including former President Bill Clinton, have been paid hundreds of thousands of dollars to speak, or act as consultants. President Bush's brother Neil was a guest of the royal family last year. And as Dubai grows from desert town to boomtown, again, no expense is being spared. Just putting up the world's tallest building isn't enough. The building will be twice this height when completed next year. One hundred sixty floors of the most luxurious apartments and offices the world has ever seen. All being built, it turns out, by workers who on average make less than a dollar an hour. Behind the glitzy world of Dubai are some 500,000 foreign workers who human rights groups say live in virtual enslavement. A report out just this week from the group Human Rights Watch concludes workers putting up Dubai's soaring towers are being systematically cheated and abused, with the sheikh's government looking the other way.
Note: If you want to see how deep this ugly hole goes, don't miss the eye-opening ABC News video at this link.
Chief executive officers in the United States earned 262 times the pay of an average worker in 2005. In fact, a CEO earned more in one workday than an average worker earned in 52 weeks, said the Economic Policy Institute in Washington, D.C. The typical worker's compensation averaged just under $42,000 for the year, while the average CEO brought home almost $11 million. In 1965, U.S. CEOs at major companies earned 24 times a worker's pay. In recent years, compensation has been a hot issue with shareholders who have been bombarded with news stories about chief executives who are given multimillion dollar bonus and pay packages even if shares have declined. The chief executives of 11 of the largest companies were awarded a total of $865 million in pay in the last two years, even as they presided over a total loss of $640 billion in shareholder value, a recent study from governance firm the Corporate Library, found.
The pharmaceutical industry is bracing itself for criticism when the film 'The Constant Gardener' opens next month. Away from the Hollywood script is a true story of how multinational drug companies took liberties with African lives with devastating consequences. Directed by Fernando Meirelles, of City of God fame, it is a thriller, a love story and a blistering attack on the drugs industry and the way it carelessly expends the lives of innocent citizens in the Third World in the quest for billion-dollar medicines to sell to the first world. After the credits roll, a note from John Le Carr appears on screen that reads: "As my journey through the pharmaceutical jungle progressed, I came to realise that, by comparison with the reality, my story was as tame as a holiday postcard." The film features two brutal killings, a savage beating, a campaign of harassment, intimidation and threats. The crimes of the pharmaceutical industry - from the price protection of Aids drugs which have denied life-saving medicines to millions, to the cover up of lethal side effects to protect profits - are well documented. The companies are not obliged to disclose a lot of information about how they test or make their drugs. There's big, big money involved. Editors of medical journals including The Lancet and The Journal of the American Medical Association had come under pressure not to publish data or to change it. The bigger scandal...lies in the rapacious pricing of the pharmaceutical industry that puts lifesaving drugs out of reach of individuals, hospitals and even nations.
Sen. Bernie Sanders, speaking at a policy forum here Tuesday, identified a singular roadblock to achieving success on a host of progressive policies. Its American oligarchy. Sanders ... argued that the small number of multi-billionaires who now have power over the countrys economic, political and social life is one issue out there which is so significant and so pervasive that, unless we successfully confront it, it will be impossible to succeed on any of these other important issues. The solution, he said, is not only ending voter suppression, extreme gerrymandering and overturning the Citizens United Supreme Court decision, which helped pave the way for super PACs, but moving toward automatic voter registration. He called for Wall Street, billionaires and big corporations to start paying their fair share in taxes, and for substantially increasing the estate tax. The annual conference ... was billed in part as an opportunity for speakers to preview and sharpen the best arguments for rejecting far-right conservatism and for enacting progressive policies at all levels of government. During his speech Tuesday, Sanders ... said the current grotesque level of income and wealth inequality is immoral and causing massive suffering.
Note: For more along these lines, see concise summaries of deeply revealing news articles on government corruption and income inequality.
CEOs at the biggest companies got a 4.5 percent pay raise last year. That's almost double the typical American worker's, and a lot more than investors earned from owning their stocks - a big fat zero. The typical chief executive in the Standard & Poor's 500 index made $10.8 million, including bonuses, stock awards and other compensation, according to a study by executive data firm Equilar for The Associated Press. That's up from the median of $10.3 million the same group of CEOs made a year earlier. The raise alone for median CEO pay last year, $468,449, is more than 10 times what the typical U.S. worker makes in a year. The median full-time worker earned $809 weekly in 2015, up from $791 in 2014. "With inflation running at less than 2 percent, why?" asks Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware. The answer is complicated. CEO pay packages now hinge on multiple layers of sometimes esoteric measurements of performance. That's a result of corporate boards attempting to respond to years of criticism ... from Main Street America, regulators and even candidates on the presidential trail this year. One bright spot, experts say, is the rise in the number of companies that tie CEO pay to how well their stocks perform. "There's progress generally in aligning compensation with shareholder returns," says Stu Dalheim, vice president of governance and advocacy at Calvert Investments. "But I don't think this compensation is sustainable."
Note: For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
The pernicious influence of "economic hit men" has spread around the globe. John Perkins revealed his first-hand experience of this violent and coercive phenomenon. Now, in The New Confessions of an Economic Hit Man, he brings this story of greed and corruption up to date. The treacherous cancer beneath the surface, which was revealed in the original Confessions of an Economic Hit Man, has ... spread from the economically developing countries to the United States and the rest of the world; it attacks the very foundations of democracy and the planet's life-support systems. Although this cancer has spread widely and deeply, most people still aren't aware of it; yet all of us are impacted by the collapse it has caused. It has become the dominant system of economics, government, and society today, [and] created a "death economy" - one based on wars or the threat of war, debt, and the rape of the earth's resources. Although the death economy is built on a form of capitalism, it is important to note that the word capitalism ... includes local farmers' markets as well as this very dangerous form of global corporate capitalism, controlled by the corporatocracy. Despite all the bad news and the attempts of modern-day robber barons to steal our democracy and our planet ... when enough of us perceive the true workings of this EHM system, we will take the individual and collective actions necessary to control the cancer and restore our health.
Note: Read a revealing seven-page summary of Economic Hit Man and spread the word!
Robert Reich, former secretary of labor under President Bill Clinton and a professor of public policy at University of California, Berkeley, spent years warning of twin demons: Technology and globalization. Machines displaced ... workers whose routine jobs could be automated, and globalization meant the flight of manufacturing and service jobs to factories and call centers in emerging countries. The result was ever-widening inequality. In his latest book, Saving Capitalism: For the Many, Not the Few, hes changed his tune. While those two factors still play a role in growing inequality, he cites a new culprit: the increasing concentration of political power in a corporate and financial elite that has been able to influence the rules by which the economy runs. [Reich explains], "Capitalism is based on trust. Its impossible to have a system that works well and is based on billions of transactions if people dont trust that others are going to fulfill their obligations, or they fear someone will take advantage of them or exploit them. Thats when a system moves from production to protection. Economists have been documenting inequality using various measures, but I havent seen much documentation of this issue of power. Political scientists and economists are [reluctant] to get into this field. Economists look at market power and monopolies, but the other areas Ive talked about - this vicious cycle of compounded wealth and power that changes the rules of the game - economists are really not taking it on."
Note: Read how the market is rigged to grow inequality in this summary of a Robert Reich essay that recently appeared in Newsweek. For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
In 2015, the pope will issue a lengthy message on [climate change] to the worlds 1.2 billion Catholics, give an address to the UN general assembly and call a summit of the worlds main religions. The reason for such frenetic activity, says Bishop Marcelo Sorondo, chancellor of the Vaticans Pontifical Academy of Sciences, is the popes wish to directly influence next years crucial UN climate meeting in Paris. The idea is to convene a meeting with leaders of the main religions to make all people aware of the state of our climate and the tragedy of social exclusion. In March ... the pope will publish a rare encyclical on climate change and human ecology. Urging all Catholics to take action on moral and scientific grounds, the document will be sent to the worlds 5,000 Catholic bishops and 400,000 priests, who will distribute it to parishioners. In recent months, the pope has argued for a radical new financial and economic system to avoid human inequality and ecological devastation. Franciss environmental radicalism is likely to attract resistance from Vatican conservatives and in rightwing church circles, particularly in the US. Francis will also be opposed by the powerful US evangelical movement, said Calvin Beisner, spokesman for the conservative Cornwall Alliance for the Stewardship of Creation, which has declared the US environmental movement to be un-biblical and a false religion. The pope should back off, he said.
Note: For more along these lines, see concise summaries of deeply revealing articles on climate change and income inequality from reliable major media sources.
Congressional liberals rebelled Wednesday against a must-pass spending bill that would ... roll back critical limits on Wall Street and sharply increase the influence of wealthy campaign donors. Sen. Elizabeth Warren (D-Mass.), a popular figure on the left, led the insurrection with a speech on the Senate floor, calling the $1.01 trillion spending bill the worst of government for the rich and powerful. Meanwhile, White House press secretary Josh Earnest said, I dont think the vast majority of Democrats or even Republicans are going to look too kindly on a Congress thats ready to go back and start doing the bidding of Wall Street interests again. On the Senate floor, Warren said the changes in the spending bill would let derivatives traders on Wall Street gamble with taxpayer money and get bailed out by the government when their risky bets threaten to blow up our financial system. She added: These are the same banks that nearly broke the economy in 2008 and destroyed millions of jobs. Rep. Chris Van Hollen (D-Md.), who opposed the 2013 bill, said he would vote against the new spending measure in its current form. The change to Dodd-Frank coupled with the campaign finance provision makes for a toxic blend, he said. Van Hollen was one of the few Democrats willing to risk a government shutdown by blocking the bill. Pressed by reporters, even Warren would not make that commitment.
Note: For more along these lines, see these concise summaries of deeply revealing articles about widespread corruption in government and banking and finance.
The end-of-year spending bill deal crafted by congressional leaders Tuesday would dramatically expand the amount of money that wealthy political donors could inject into the national parties, drastically undercutting the 2002 landmark McCain-Feingold campaign finance overhaul. The language inserted on page 1,599 of the 1,603-page bill would allow ... a donor who gave the maximum $32,400 this year to the Democratic National Committee or Republican National Committee ... to donate another $291,600 on top of that to the partys additional arms -- a total of $324,000, ten times the current limit. In a two-year election cycle, a couple could give $1,296,000 to a party's various accounts. "These provisions have never been considered by the House or Senate, and were never even publicly mentioned before today," said Fred Wertheimer, president of the advocacy group Democracy 21. Adam Smith, spokesman for the group Every Voice, said in a statement, Very few people can write checks almost twice the size of the countrys median income, but thats what this provision will allow. It gives the biggest donors another opportunity to influence politics and buys them more access to politicians. Campaign finance experts were taken aback by the scope of the measure, rumors of which first surfaced Tuesday, hours before the deal was finalized.
Note: For more along these lines, see these summaries of deeply revealing elections corruption and income inequality news articles from reliable major media sources.
Income inequality is taking a toll on state governments. The widening gap between the wealthiest Americans and everyone else has been matched by a slowdown in state tax revenue. Even as income for the affluent has accelerated, it has barely kept pace with inflation for most other people. That trend can mean a double-whammy for states: The wealthy often manage to shield much of their income from taxes. And they tend to spend less of it than others do, thereby limiting sales tax revenue. As the growth of tax revenue has slowed, states have faced tensions over whether to raise taxes or cut spending to balance their budgets. Rising income inequality is not just a social issue, said Gabriel Petek, the S&P credit analyst who wrote the report. It presents a very significant set of challenges for the policy makers. Stagnant pay for most people has compounded the pressure on states to preserve funding for education, highways, and social programs such as Medicaid. Income inequality isnt the only factor slowing state tax revenue. Online retailers account for a rising chunk of consumer spending. Yet they often manage to avoid sales taxes. Consumers are spending more on untaxed services, too. Before income inequality began to rise consistently, state tax revenue grew an average of 9.97 percent a year from 1950 to 1979. That average steadily fell with each subsequent decade, dipping to 3.62 percent between 2000 and 2009.
Note: For more on this, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
Market economies need a certain amount of inequality to function. But American inequality has become so extreme that its inflicting a lot of economic damage. And this, in turn, implies that redistribution that is, taxing the rich and helping the poor may well raise, not lower, the economys growth rate. There is solid evidence, coming from places like the International Monetary Fund, that high inequality is a drag on growth, and that redistribution can be good for the economy. [This] view about inequality and growth got a boost from Standard & Poors, the rating agency, which put out a report supporting the view that high inequality is a drag on growth. There is, at this point, no reason to believe that comforting the comfortable and afflicting the afflicted is good for growth, and good reason to believe the opposite. If you look systematically at the international evidence on inequality, redistribution, and growth which is what researchers at the I.M.F. did you find that lower levels of inequality are associated with faster, not slower, growth. Furthermore, income redistribution at the levels typical of advanced countries (with the United States doing much less than average) is robustly associated with higher and more durable growth. That is, theres no evidence that making the rich richer enriches the nation as a whole, but theres strong evidence of benefits from making the poor less poor. Incentives arent the only thing that matters for economic growth. Opportunity is also crucial. And extreme inequality deprives many people of the opportunity to fulfill their potential.
Note: For more on this, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
The 25 highest-paid hedge fund managers ... made a combined $21 billion in 2013. In particular, lets think about how their good fortune refutes several popular myths about income inequality in America. Apologists for soaring inequality almost always try to disguise the gigantic incomes of the truly rich by hiding them in a crowd of the merely affluent. Instead of talking about the 1 percent or the 0.1 percent, they talk about the rising incomes of college graduates. The goal of this misdirection is to soften the picture, to make it seem as if were talking about ordinary white-collar professionals who get ahead through education and hard work. But many Americans are well-educated and work hard. The vast gulf that now exists between the upper-middle-class and the truly rich didnt emerge until the Reagan years. Second, ignore the rhetoric about job creators and all that. Conservatives want you to believe that the big rewards in modern America go to innovators and entrepreneurs, people who build businesses and push technology forward. But thats not what those hedge fund managers do for a living; theyre in the business of financial speculation. Once upon a time, you might have been able to argue with a straight face that all this wheeling and dealing was productive, that the financial elite was actually providing services to society commensurate with its rewards. But, at this point, the evidence suggests that hedge funds are a bad deal for everyone except their managers; they dont deliver high enough returns to justify those huge fees, and theyre a major source of economic instability. Were still living in the shadow of a crisis brought on by a runaway financial industry.
Note: For more on financial corruption, see the deeply revealing reports from reliable major media sources available here.
Mark Zuckerberg has decided hes a $1-a-year man. Zuckerberg, who is Facebook Inc.s chief executive officer and also the 22nd richest person in the world as ranked by the Bloomberg Billionaires Index, was paid $1 in salary for 2013, according to a regulatory filing with the U.S. Securities and Exchange Commission yesterday. Thats down from a base salary of $503,205 in 2012, the year that Facebook went public. Zuckerberg is following the well worn path of other Silicon Valley technology moguls who also chose to take on the symbolic annual salary of $1 after they were already wealthy. Apple Inc.s late co-founder Steve Jobs helped popularize the practice, which is today also espoused by Google Inc. co-founders Larry Page and Sergey Brin, among others. All own sizable equity stakes in their own companies. Zuckerberg, whose wealth totals around $27 billion, owns Facebook shares that give him 61.6 percent of voting power in the Menlo Park, California-based social network, according to the filing. He saw his net worth balloon last year as Facebooks stock more than doubled in value. The 29-year-old has ramped up his public service and philanthropy, including starting a group called Internet.org to connect the world to the Web. Zuckerbergs total compensation last year was $653,165, down from $1.99 million in 2012. The amount, besides the $1 salary, was for the passenger fees, fuel, crew and catering costs for his use of private planes for personal reasons, as part of his security program, according to the filing. The CEO also made $3.3 billion last year after exercising stock options to purchase 60 million shares, according to the filing.
Note: For a treasure trove of great news articles which will inspire you to make a difference, click here.
JEFFREY BROWN: Does the amount of wealth you have affect the kind of person you are? NewsHour economics correspondent PAUL SOLMAN: In California, you're supposed to stop for a pedestrian at a crosswalk. And, in a recent study, some 90 percent of drivers did, except for those driving luxury cars. They were almost as likely to run the intersection as wait for the person to cross the street. PAUL PIFF, University of California, Berkeley: Drivers of those BMWs, those Porsches, those Mercedes were anywhere from three to four times more likely to break the law, than drivers of less expensive, low-status cars. WOMAN: Oh, by the way, there's candy there. It's actually for children for another study, but you're welcome to take a few pieces if you want to. [Other] WOMAN: Thank you. PAUL SOLMAN: That's the script an experimenter recited to every subject. And the results? PAUL PIFF: Wealthier participants took two times as much candy from children as did poor participants. PAUL SOLMAN: So, experimental evidence that rich people are more likely to break the law while driving, help themselves to candy meant for children, cheat in a game of chance, also to lie during negotiations and endorse unethical behavior, including stealing at work. The academic paper that resulted made headlines everywhere, the Wall Street Journal article leading with the question, "Ready the Pitchforks?" PAUL SOLMAN: Psychology professor Dacher Keltner is Paul Piff's [co-author]. DACHER KELTNER: We publish these studies in relatively obscure scientific journals, and literally the next day we're getting hundreds of e-mails from around the world, and a lot quite hostile.
Note: Don't miss the fascinating video at the link above, which is also available here. Note that it is not about rich people being unethical, it's about human behavior. People tend to become more unethical the more money they have. For more on income inequality, see the deeply revealing reports from reliable major media sources available 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.
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.
They're tax havens: 70 mostly tiny nations that offer no-tax or low-tax status to the wealthy so they can stash their money. Usually, the process is so secret that it draws little attention. But the sums - and lost tax revenues - are growing so large that the havens are getting new and unaccustomed scrutiny. There are about 3 million shell companies (set up largely to duck taxes) in offshore tax havens, Komisar reckons. These tiny tax havens hold 31 percent of total world assets and 26 percent of the stock of US multinationals.
Millionaires and middle-class Americans now pay taxes at almost the same rates. Lower tax rates have contributed to huge increases in the wealth of the wealthy, but so far most people haven't seen significant economic improvement. [The] latest three-year examination of family finances found that average family income fell by 2% between 2001 and 2004. In the previous three-year period, average family income grew by 17%. Thanks to more credit card debt and borrowing against their homes, the 25% of Americans at the bottom of the wealth scale had negative net worth in 2004. The first federal tax code specified a maximum rate of 7%, but after the U.S. entered the war in 1917, Congress boosted the top rate to 77%. The 1986 tax overhaul brought the top rate to 28% in 1988, its lowest level since 1931. President Bush has achieved something close to the flat-rate structure by cutting tax rates on earned income and particularly on dividends and investment profits. Although the top tax rate is 35%, nobody pays that percentage. People with income between $500,000 and $1 million owed the same share of their income... -- 22% -- as did taxpayers reporting at least $1 million in income. Taxpayers in the $100,000 to $200,000 range paid nearly the same rate, 20.6%. Those in the $50,000 to $75,000 range paid 17.4%; taxpayers in the $40,000 to $50,000 range paid 15.8%. During the previous seven economic expansions before the current one, employee compensation rose four times faster than corporate profits. In the current expansion, profits have risen three times faster than compensation.
Pay comparisons almost always leave someone feeling dwarfed, and none more so than the CEO-to-worker pay gap. But even CEOs have reason to feel seriously dwarfed these days, thanks to the outsized paychecks of private equity and hedge fund managers. The average CEO of a large U.S. company made roughly $10.8 million last year, or 364 times that of U.S. full-time and part-time workers, who made an average of $29,544, according to a joint analysis released Wednesday by the liberal Institute for Policy Studies and United for a Fair Economy. The IPS and UFE pay-gap numbers are also wider than some other measures of CEO-to-worker pay because they count both full-time and part-time workers in their calculations, which effectively lowers workers' average pay due to fewer hours worked. If you just consider the average compensation (wages plus benefits) of full-time year-round workers in non-managerial jobs - roughly $40,000 - CEO pay is more like 270 times bigger than the average Joe's. That's still a far cry from days gone by. In 1989, for instance, U.S. CEOs of large companies earned 71 times more than the average worker, according to the Economic Policy Institute. The top 20 CEOs of U.S. companies made an average of $36.4 million in 2006. The pay gap numbers don't include the value of the many perks CEOs receive, which averaged $438,342, according to the report. Nor do they include the pension benefits CEOs receive. But even including all that, CEO pay can look like chump change next to private equity and hedge fund managers' pay. Those managers made an average of $657.5 million in 2006 - more than 16,000 times what the average full-time worker makes, and roughly 61 times that of the average CEO.
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