by Eric Zuesse
May 28, 2013
The top 1 per cent
has seen its real income rise
by more than 60 per cent
over those two decades.
The lead research economist at
the World Bank,
Branko Milanovic, will be reporting soon, in the journal Global
Policy, the first calculation of global income-inequality, and he has found
that the top 8% of global earners are drawing 50% of all of this planet's
"Global inequality is much greater than
inequality within any individual country,"
...because the stark inequality between
countries adds to the inequality within any one of them, and because most
people live in extremely poor countries, largely the nations within three
thousand miles of the Equator, where it's already too hot, even without the
global warming that scientists say will heat the world much more from now
The World Bank's list of "GDP per capita (current US$)" shows
that in 2011 this annual-income figure ranged from $231 in Democratic
Republic of Congo at the Equator, to $171,465 in Monaco within Europe.
The second-poorest and second-richest countries
respectively were $271 in Burundi at the Equator, and $114,232 in Luxembourg
For comparisons, the U.S. was $48,112, and China
Those few examples indicate how widely per-capita income ranges
between nations, and how more heat means more poverty.
Wealth-inequality is always far higher than income-inequality, and therefore
a reasonable estimate of personal wealth throughout the world would probably
be somewhere on the order of the wealthiest 1% of people owning roughly half
of all personal assets.
These individuals might be considered the
current aristocracy, insofar as their economic clout is about equal to that
of all of the remaining 99% of the world's population.
"Among the global top 1 per cent, we find
the richest 12 per cent of Americans... and between 3 and 6 per cent of
the richest Britons, Japanese, Germans and French. It is a 'club' that
is still overwhelmingly composed of the 'old rich',"
...who pass on to their children (tax-free in
the many countries that have no estate-taxes) the fortunes that they have
accumulated, and who help set them up in businesses of their own - often
after having sent them first to the most prestigious universities (many in
the United States), where those children meet and make friends of others who
are similarly situated as themselves.
For example, on 22 April 2004, The New York Times headlined "As
Wealthy Fill Top Colleges, Concerns Grow Over Fairness," and reported
that 55% of freshman students at the nation's 250 most selective colleges
and universities came from parents in the top 25% of this nation's income.
Only 12% of students had parents in the bottom
25% of income.
Even at an elite public, state, college, the
University of Michigan,
"more members of this year's freshman class... have parents making at least $200,000 a year [then America's top 2%]
than have parents making less than the national median of about $53,000
[America's bottom 50%].'"
Most of the redistribution that favors more than
just the top 1% has occurred in the "developing" countries, such as China.
However, a larger proportion of the world's
population live in nations of Central and South America, Africa, etc., where
today's leading families tend overwhelmingly to be the same as in the
previous generation. They, too, near the Equator, are members of the "club,"
but there are fewer of them.
Milanovic finds that globally,
"The top 1 per cent has seen its real income
rise by more than 60 per cent over those two decades [1988-2008]," while
"the poorest 5 per cent" have received incomes which "have remained the
same" - the desperately poor are simply remaining desperately poor.
Maybe there's too much heat where they live.
This study, in Global Policy, to be titled "Global Income Inequality in
Numbers - In History and Now," reports that economic developments of the past
twenty years have caused,
"the top 1 per cent to pull ahead of the other rich
and to reaffirm in fact - and even more so in public perception - its
preponderant role as a winner of globalization."
A summary video of Milanovic's research
can be seen here below:
In this interview Branko Milanovic, a lead economist in the
World Bank's research department, explains his argument that
the shift in inequality has moved from class to location. He
also discusses migratory pressures arising from inequality
and the need for multi-lateral agreements between rich
countries to tackle this issue.