Wednesday, December 06, 2006

Wealth Bomb

Check out the findings of a new WIDER/United Nations University report: for two percent of the world's people, wealth continues to grow and remains in their locked fists, while poverty remains widespead and difficult to escape on 98% of the human planet.

It is important to note the difference between wealth and income to appreciate the depth of these findings. While income (earnings, salaries) is unequally distributed worldwide, wealth (holdings, property, assets, inheritence, stocks) makes this gap truly alarming and inescapable. In most places, you can't walk out your door without falling into the wealth canyon that divides you from the superrich, and perhaps picking up some scrapes and bruises on your way down. A more vivid illustration? According to the study, if the world's population were represented by 10 people, one person would hold $99 and the remaining 9 would share $1.

In the U.S., anyone can see how wealth gets protected and work gets taxed by examining your paycheck. If you were rich enough to funnel all your earnings into an untaxed trust, you'd be paying no tax on it, and your heirs would reap the green rewards. Or you could get it all back at your rocking 60th birthday party. And if you opened a foundation to support any cause you like, probably causes that protect the economic systems from which you benefit, you'd only be required to pay out 5% a year in grants. And the less money you make, the higher percentage of your net earnings you'll probably pay in taxes.

Changing this situation will require a worldwide shift in values and priorities, and a lot of hard work and thought, but it wouldn't hurt to start taxing the rich more in this country. Last we checked, they drive on roads and go to public and private universities that rely on federal funds, too. Investing more public money in community improvements like public transportation to reduce toxins in the air in poor communities, and in child care, education and health institutions, would go far in a relatively short period of time, and allow more people the chance to start narrowing the U.S.'s grand wealth canyon, not to mention the chance to become happier and more productive citizens.

Unleash some of that looming wealth, America! Local, national and international structures that exist to protect and reproduce wealth indeed play a large role in creating a situation where (italics mine):

In 2000, the top 1 percent of the world’s population — some 37 million adults with a net worth of at least $515,000 — accounted for about 40 percent of the world’s total net worth.

The bottom half of the population owned merely 1.1 percent of the globe’s wealth. The net worth of the world’s typical person — whose wealth was above that of half the world’s population and below that of the other half —was under $2,200.

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