Income Inequality News StoriesExcerpts of Key Income Inequality News Stories in Major Media
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The billionaires and corporate oligarchs meeting in Davos this week are getting worried about inequality. The architects of the crisis-ridden international economic order are starting to see the dangers ... of the widest global economic gulf in human history. The scale of the crisis has been laid out for them by the charity Oxfam. On current trends, the richest 1% will have pocketed more than the other 99% put together next year. The 0.1% have been doing even better, quadrupling their share of US income since the 1980s. In most of the world, labour’s share of national income has fallen continuously and wages have stagnated under this regime of privatisation, deregulation and low taxes on the rich. At the same time finance has sucked wealth from the public realm into the hands of a small minority, even as it has laid waste the rest of the economy. Now the evidence has piled up that not only is such appropriation of wealth a moral and social outrage, but it is fuelling social and climate conflict, wars, mass migration and political corruption, stunting health and life chances, increasing poverty, and widening gender and ethnic divides. Escalating inequality has also been a crucial factor in the economic crisis of the past seven years, squeezing demand and fuelling the credit boom. The thinking person’s Davos oligarch realises that allowing things to carry on as they are is dangerous. What they won’t accept is any change in the balance of social power.
Note: Oxfam's complete report "identifies the two powerful driving forces that have led to the rapid rise in inequality" as "market fundamentalism and the capture of politics by elites." For more along these lines, see concise summaries of deeply revealing news articles on income inequality and secret societies which manipulate global politics.
The World Economic Forum’s annual meeting [in Davos, Switzerland is] a heady power gathering that mixes business, politics and Champagne in the Swiss Alps. It is an event that draws a wide range of [chief executives, government leaders and academics], ostensibly to contemplate how to solve the world’s problems. An invitation to the meeting is supposed to be considered an exclusive honor. But for corporate executives, the cost of being a Davos Man, or, yes, a Davos Woman, even for just a couple of days, does not come cheap. Just to have the opportunity to be invited to Davos, you must be invited to be a member of the World Economic Forum. There are several levels of membership: the basic level, which will get you one invitation to Davos, costs 50,000 Swiss francs, or about $52,000. The ticket itself is another 18,000 Swiss francs ($19,000), plus tax, bringing the total cost of membership and entrance fee to $71,000. But that fee just gets you in the door. To participate in private sessions among your industry’s peers, you need to step up to the “Industry Associate” level. That costs $137,000, plus the price of the ticket, bringing the total to about $156,000.
Note: After attending this event, author David Rothkopf quoted AOL's founder as saying,"You always feel like ... the real Davos is happening in secret somewhere." Might this suggest that Davos is a breeding ground for the secret plots of the global elite? For more along these lines, see concise summaries of news articles on secret societies which manipulate global politics.
The richest 1 percent are likely to control more than half of the globeâ€™s total wealth by next year, the charity Oxfam reported in a study released on Monday. The warning about deepening global inequality comes just as the worldâ€™s business elite prepare to meet this week at the annual World Economic Forum in Davos, Switzerland. The 80 wealthiest people in the world altogether own $1.9 trillion, the report found, nearly the same amount shared by the 3.5 billion people who occupy the bottom half of the worldâ€™s income scale. And the richest 1 percent of the population, who number in the millions, control nearly half of the worldâ€™s total wealth, a share that is also increasing. The type of inequality that currently characterizes the worldâ€™s economies is unlike anything seen in recent years, the report explained. â€śBetween 2002 and 2010 the total wealth of the poorest half of the world in current U.S. dollars had been increasing more or less at the same rate as that of billionaires,â€ť it said. â€śHowever since 2010, it has been decreasing over that time.â€ť Investors with interests in finance, insurance and health saw the biggest windfalls, Oxfam said. Using data from Forbes magazineâ€™s list of billionaires, it said those listed as having interests in the pharmaceutical and health care industries saw their net worth jump by 47 percent. The charity credited those individualsâ€™ rapidly growing fortunes in part to multimillion-dollar lobbying campaigns to protect and enhance their interests.
Note: A single ticket to the World Economic Forum event in Davos costs a small fortune. Will the global elites that attend this event pay attention to Oxfam's latest paper, and make it a priority to reduce income inequality?
The [richest] 1% of the worldâ€™s population will own more global wealth than the 99% [by next year]. Oxfam executive director, Winnie Byanyima, is arguing that this increasing concentration of wealth ... is â€śbad for growth and bad for governanceâ€ť. Whatâ€™s more, inequality is bad not just for the poor, but for the rich too. Thatâ€™s why we have the likes of the IMFâ€™s Christine Lagarde kicking off with warnings about rising inequality. Visceral inequality ... is still seen as somehow being [a] moral failure of the poor. This in turn sustains the idea that rich people deserve their incredible riches. Most wealth, though, is not earned: huge assets, often inherited, simply get bigger [for] deliberate and systemic reasons. Inequality is not inevitable, itâ€™s engineered. Many mainstream economists do not question the degree of this engineering. Neoliberalism [has been] a stage of capitalism in which the financial markets were deregulated, public services privatised, welfare systems run down, laws to protect working people dismantled, and unions cast as the enemy. Oxfamâ€™s suggestions at Davos are attempts to claw back some basic rights. But isnâ€™t it rather incredible that a charity has to do this?
Note: Oxfam's complete report "identifies the two powerful driving forces that have led to the rapid rise in inequality" as "market fundamentalism and the capture of politics by elites." For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources.
Nicholas and Jill Woodman ... will receive a huge tax deduction for their [charitable] donation of 5.8 million shares of company stock to a donor-advised fund. But there’s no guarantee that one dollar of their October donation will ever be spent [on charity]. Donors gets an immediate, one-time tax break by depositing their money or assets in a donor-advised fund. They can advise the institution holding their money where and when to spend it on their timetable. Boston College Law School Professor Ray Madoff points out, “It is like money-laundering." There was $54 billion under management in donor-advised funds in 2013. Top financial houses like Fidelity, Schwab and Vanguard have fully embraced donor-advised funds. Fidelity Charitable, with $13.2 billion worth of assets under management, is now the nation’s second-largest charity. Even though organizations like Fidelity Charitable, Schwab Charitable and Vanguard Charitable were founded by their financial house namesakes, they are separate 501(c)3 charities. But while Fidelity Charitable is independent from the financial institution, roughly two-thirds of the money in the charitable arm is invested in Fidelity mutual funds. Madoff said that because investment advisers can charge a fee for managing the money in these accounts, they have a natural incentive to keep the money in these accounts growing — and not leaving.
In 2015, the pope will issue a lengthy message on [climate change] to the world’s 1.2 billion Catholics, give an address to the UN general assembly and call a summit of the world’s main religions. The reason for such frenetic activity, says Bishop Marcelo Sorondo, chancellor of the Vatican’s Pontifical Academy of Sciences, is the pope’s wish to directly influence next year’s 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 world’s 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. Francis’s 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.
Consider the new spending bill Congress and the president agreed to a few weeks ago. Under the $1.1 trillion measure, government spending doesn't rise as a percent of the total economy. If the economy grows as expected, government spending will actually shrink over the next year. The problem with the legislation is who gets the goodies and who's stuck with the tab. Only about 12 percent of federal spending goes to individuals and families. An increasing portion goes to corporate welfare. In addition to the provisions in the recent spending bill that reward Wall Street, health insurers, the travel industry, food companies and defense contractors, other corporate goodies have long been baked into the federal budget. Big agribusiness gets price supports. Hedge-fund and private-equity managers get their own special "carried-interest" tax loophole. The oil and gas industry gets its special tax subsidies. Big Pharma gets a particularly big benefit: a prohibition on government using its vast bargaining power under Medicare and Medicaid to negotiate low drug prices. The new spending legislation, just enacted, makes it easier for wealthy individuals to write big checks to political parties. Much of government is no longer working for the vast majority it's intended to serve. Unless or until we can reverse the vicious cycle of big money getting political favors that makes big money even bigger, we can't get the government we want and deserve.
Some of the highest employment rates in the advanced world are in places with the highest taxes and most generous welfare systems, namely Scandinavian countries. The United States and many other nations with relatively low taxes and a smaller social safety net actually have substantially lower rates of employment. In Scandinavian countries, working parents have the option of heavily subsidized child care. Leave policies make it easy for parents to take off work. Heavily subsidized public transportation may make it easier for a person in a low-wage job to get to and from work. And free or inexpensive education may make it easier to get the training to move from the unemployment rolls to a job. Wages for entry-level work are much higher in the Nordic countries than in the United States, reflecting a higher minimum wage, stronger labor unions and cultural norms that lead to higher pay. Perhaps more Americans would enter the labor force if even basic jobs paid [adequate wages], regardless of whether the United States provided better child care and other services. There is a lesson from Scandinavia useful in its simplicity: If you make it easier for people to work, it may be the case that more will.
Note: Explore a treasure trove of concise summaries of incredibly inspiring news articles which will inspire you to make a difference.
A report released on Wednesday by the Pew Research Center found that the wealth gap between the country’s top 20 percent of earners and the rest of America had stretched to its widest point in at least three decades. Last year, the median net worth of upper-income families reached $639,400, nearly seven times as much of those in the middle, and nearly 70 times the level of those at the bottom. There has been growing attention to the issue of income inequality. But while income and wealth are related ... the wealth gap zeros in on a different aspect of financial well-being: how much money and other assets you have accumulated over time. “The Great Recession destroyed a significant amount of middle-income and lower-income families’ wealth, and the economic ‘recovery’ has yet to be felt for them,” the report concluded. The median household net worth last year for those in the middle was $96,500, only slightly above the $94,300 mark it hit in 1983 (after being adjusted for inflation). A poor household actually had a higher median net worth 30 years ago ($11,400 in 1983) than it counted last year ($9,300). Compare those results with the top fifth of income earners. In 1983, when the Fed began collecting the data, that group had a median wealth of $318,000; in 2013 it owned more than twice that.
Note: For more along these lines, see concise summaries of deeply revealing income inequality news articles 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 don’t think the vast majority of Democrats or even Republicans are going to look too kindly on a Congress that’s 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.
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 party’s 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 country’s median income, but that’s 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.
According to new research by Emmanuel Saez of the University of California at Berkeley and Gabriel Zucman of the London School of Economics, the richest one-hundredth of one percent of Americans now hold more than 11 percent of the nation's total wealth. That's a higher share than the top .01 percent held in 1929, before the Great Crash. We're talking about 16,000 people, each worth at least $110 million. This explosion of wealth at the top has been accompanied by an erosion of the wealth of the middle class and the poor. Some might think [that] if those at the top are winning big while the bottom 90 percent is losing, too bad. That's the way the game is played. But the top .01 percent have also been ... changing the game. Their political investments have paid off in the form of lower taxes on themselves and their businesses, subsidies for their corporations, government bailouts, federal prosecutions ... where executives don't go to jail, watered-down regulations, and non-enforcement of antitrust laws. Since the top .01 began investing big time in politics, corporate profits and the stock market have risen to record levels. That's enlarged the wealth of the richest .01 percent. But the bottom 90 percent ... rely on wages, which have been trending downward. Politicians don't seem particularly intent on reversing this trend. If you want to know what's happened to our democracy, follow the richest .01 percent. They'll lead you to the politicians who have been selling our democracy.
Note: For more along these lines, see these summaries of deeply revealing income inequality news articles.
The number of billionaires has doubled since the start of the financial crisis, according to a major new report from anti-poverty campaigners. According to Oxfam, the world’s rich are getting richer, leaving hundreds of millions of people facing a life “trapped in poverty” as global “inequality spirals out of control”. The report found that the number of billionaires in the world has more than doubled to 1,646 since the financial crisis of 2009, and Oxfam says is evidence that the benefits of a return to economic growth are “not being shared with the vast majority”. The influential report is supported by Bank of England chief economist Andrew Haldane and Nobel Prize-winning economist Joseph Stiglitz. Mark Goldring, Oxfam’s chief executive, said: “Inequality is one of the defining problems of our age. In a world where hundreds of millions of people are living without access to clean drinking water and without enough food to feed their families, a small elite have more money than they could spend in several lifetimes. Earlier this month the OECD said global inequality was at its worst levels since 1820. Mr Haldane agreed, saying: “In highlighting the problem of inequality Oxfam not only speaks to the interests of the poorest people but also the wider collective interest: there is rising evidence that extreme inequality harms, durably and significantly, the stability of the financial system and growth in the economy. It slows development of the human, social and physical capital necessary for raising living standards and improving well-being.”
Note: For more along these lines, see these concise summaries of deeply revealing income inequality news articles.
Before 2002, parties could accept unlimited donations from individuals or groups (corporations, labor unions, etc.). The McCain-Feingold law, as it came to be known, banned soft-money contributions, and it also prohibited political groups that operate outside the regulated system and its donation limits from running “issue ads” that appear to help or hurt a candidate close to an election. In 2010, the Citizens United decision by the Supreme Court effectively blew apart the McCain-Feingold restrictions on outside groups and their use of corporate and labor money in elections. That same year, a related ruling from a lower court made it easier for wealthy individuals to finance those groups. What followed has been the most unbridled spending in elections since before Watergate. In 2000, outside groups spent $52 million on campaigns, according to the Center for Responsive Politics. By 2012, that number had increased to $1 billion. The result was a massive power shift. With the advent of Citizens United, any players with the wherewithal, and there are surprisingly many of them, can start what are in essence their own political parties, built around pet causes or industries and backing politicians uniquely answerable to them. No longer do they have to buy into the system. Instead, they buy their own pieces of it outright. “Suddenly, we privatized politics,” says Trevor Potter, an election lawyer who helped draft the McCain-Feingold law.
Note: To understand the decisive role that money plays in elections politics, read this entire, revealing article. For more along these lines, see concise summaries of deeply revealing election process news articles from reliable major media sources. For more along these lines, see the excellent, reliable resources provided in our Elections Information Center.
Citizens United v. Federal Election Commission in 2010 tossed aside decades of legislative restrictions, freeing corporations and unions to spend as much as they wished. Six months ago, the Supreme Court took its Citizens United decision further. In McCutcheon v. Federal Election Commission, it struck down long standing caps on what an individual may contribute to all federal candidates, collectively, in any two-year election cycle. With conservative justices dominant, the court expanded the concept that money is equivalent to speech, protected by the First Amendment. Corporations, it said, enjoy the same political rights as individuals. A study by the Sunlight Foundation, an advocate for government transparency, found that 31,385 people — that is 1 percent of 1 percent of the United States population — accounted for 28 percent of all disclosed contributions in the 2012 elections. This year, an analysis by The New York Times shows, more than half of broadcast advertising in the midterm elections has been paid for by groups that reveal little or nothing about their donors. Overwhelmingly, the main beneficiaries have been conservative organizations.
Note: For more along these lines, see concise summaries of deeply revealing election news articles from reliable major media sources. For more along these lines, see the excellent, reliable resources provided in our Elections Information Center.
Once upon a time, the American economy worked. The new, harsh reality is that the bottom 90 percent of households are poorer today than they were in 1987 -- it turns out that everybody but the richest 10 percent of Americans are worst off. That includes the poor, the entire middle class, and even what we would consider much of the upper class. In this chart, I've taken each group's inflation-adjusted net worth from 1945 and indexed that to 100, so we can compare how wealth has grown for people with lots or little of it. It's been a lost 25 years for the bottom 90 percent, but a lost 15 for the next 9 percent, too. That's right: altogether, the bottom 99 percent are worth less today than they were in 1998. But this isn't a story about the top 1 percent running away from everybody else. It's a story about the top 0.1 — scratch that, the top 0.01 percent — doing so. Indeed, since 1980, the top 0.01 percent's piece of the wealth pie has increased by 8.6 percentage points, while the next 0.09 percent's has done so by 5.4. The bottom 99 percent, meanwhile, have seen their wealth share fall an astonishing 18 percentage points.
Note: For more along these lines, see concise summaries of deeply revealing income inequality news articles from reliable major media sources. For more on how our financial system produces inequality, see the excellent, reliable resources provided in our Banking Corruption Information Center.
TIME: Your book Just Mercy is about getting legal help for poor people in Alabama. What are the biggest impediments? BRYAN STEVENSON (Lawyer and founder of the Equal Justice Initiative): We have a criminal-justice system that treats you better if you’re rich and guilty than if you’re poor and innocent. I don’t believe that America’s system is shaped by culpability. I think it’s shaped by wealth. TIME: 1 in 3 black men in the U.S. under 30 is in jail, on probation or on parole. Is this the scariest stat? STEVENSON: That 1 in 3 black males born in 2001 is expected to go to jail or prison during their lifetimes is more astonishing because it’s about the future. And 1 in 6 Latino boys. That wasn’t true in the 20th century. TIME: What do you say to people who say, “It’s easy to not go to jail–don’t commit a crime”? STEVENSON: In this country we have a presumption of guilt that follows young kids of color. I’ve represented 10-year-olds being prosecuted as adults. They are put in an adult jail. It’s so unnecessary–we have juvenile facilities. No one defends it, and yet we still have 10,000 children in an adult jail or prison. TIME: What’s the role of the corporations that build prisons? STEVENSON: Corporations have really corrupted American criminal justice by creating these perverse incentives where they actually pay legislators to create new crimes so that we can maintain these record-high-level rates of imprisonment. These companies spend millions of dollars a year on lobbying. Prison spending has gone from $6 billion in 1980 to $80 billion today.
Note: For more details about Stevenson's uphill battle as a legal advocate for the poor, read the full article of the Time interview at the link above. For more along these lines, see these excellent, concise summaries of prison corruption news stories from major media sources.
Imagine a system of college education supported by high and growing government spending on elite private universities that mainly educate children of the wealthy and upper-middle class, and low and declining government spending on public universities that educate large numbers of children from the working class and the poor. You can stop imagining. That's the American system right now. The annual government subsidy to Princeton University, for example, is about $54,000 per student, according to an estimate by economist Richard Vedder. Other elite privates aren't far behind. Public universities, by contrast, have little or no endowment income. They get almost all their funding from state governments. But these subsidies have been shrinking. State and local financing for public higher education came to about $76 billion last year, nearly 10 percent less than a decade before. Since more students attend public universities now than ten years ago, that decline represents a 30 percent drop per student. That means the average annual government subsidy per student at a public university comes to less than $4,000, about one-tenth the per student government subsidy at the elite privates. So what justifies the high per-student government subsidies at the elite private universities, and the low per-student subsidies in public universities? There is no justification.
Note: For more along these lines, see concise summaries of deeply revealing news articles about income inequality 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 isn’t 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.
Occupy Wall Street is tackling a new beast: student loans. Marking the third anniversary of the Occupy Wall Street movement, the group's Strike Debt initiative announced ... it has abolished $3.8 million worth of private student loan debt since January. It said it has been buying the debts for pennies on the dollar from debt collectors, and then simply forgiving that money rather than trying to collect it. In total, the group spent a little more than $100,000 to purchase the $3.8 million in debt. While the group is unable to purchase the majority of the country's $1.2 trillion in outstanding student loan debt because it is backed by the federal government, private student debt is fair game. This debt Occupy bought belonged to 2,700 people who had taken out private student loans to attend Everest College, which is run by Corinthian Colleges. Occupy zeroed in on Everest because Corinthian Colleges is one of the country's largest for-profit education companies and has been in serious legal hot water lately. Following a number of federal investigations, the college told investors this summer that it plans to sell or close its 107 campuses due to financial problems -- potentially leaving its 74,000 students in [the] lurch. "Despite Corinthian's dire financial straits, checkered past, and history of lying to and misleading vulnerable students, tens of thousands of people may still be liable for the loans they have incurred while playing by the rules and trying to get an education," a Strike Debt member said in an email.
Note: Explore a treasure trove of concise summaries of incredibly inspiring news articles which will inspire you to make a difference.
Important Note: Explore our full index to revealing excerpts of key major media news stories on several dozen engaging topics. And don't miss amazing excerpts from 20 of the most revealing news articles ever published.