Oxfam Aging Paper
178 OXFAM BRIEFING PAPER
20 JANUARY 2014
Housing for the wealthier middle classes rises above the insecure housing of a slum community in Lucknow, India. Photo: Tom
Pietrasik/Oxfam
WORKING FOR THE FEW
Political capture and economic inequality
Economic inequality is rapidly increasing in the majority of countries. The wealth of the world is divided in two: almost half going to the richest one percent; the other half to the remaining 99 percent. The World Economic Forum has identified this as a major risk to human progress. Extreme economic inequality and political capture are too often interdependent. Left unchecked, political institutions become undermined and governments overwhelmingly serve the interests of economic elites …show more content…
Based on those surveyed, inequality is ‘impacting social stability within countries and threatening security on a global scale.’ Oxfam shares its analysis, and wants to see the 2014 World Economic Forum make the commitments needed to counter the growing tide of inequality.
Some economic inequality is essential to drive growth and progress, rewarding those with talent, hard earned skills, and the ambition to innovate and take entrepreneurial risks. However, the extreme levels of wealth concentration occurring today threaten to exclude hundreds of millions of people from realizing the benefits of their talents and hard work. Extreme economic inequality is damaging and worrying for many reasons: it is morally questionable; it can have negative impacts on economic growth and poverty reduction; and it can multiply social problems. It compounds other inequalities, such as those between women and men. In many countries, extreme economic inequality is worrying because of the pernicious impact that wealth concentrations can have on equal political representation. When wealth captures government policymaking, the rules bend to favor the rich, often to …show more content…
A pernicious result is the skewing of public policy to favor elite interests, which has coincided with the greatest concentration of wealth among the richest one percent since the eve of the Great Depression.
As policies favoring corporations gained ascendancy, the bargaining power of labor unions plummeted and the real value of the minimum wage and other protections eroded. It is now harder for unions to organize, and easier for big businesses to suppress wages and erode workers’ benefits.
Wealthy interest groups have also used their financial might to influence legislators and the general public to keep downward pressure on top income tax rates and capital gains, and to create corporate tax loopholes.
Because capital is taxed at lower rates than income, millions of average working Americans pay higher tax rates than the rich.
From the 1980s onwards, the financial and banking sectors pumped millions of dollars into undoing regulations put in place after the
20 JANUARY 2014
Housing for the wealthier middle classes rises above the insecure housing of a slum community in Lucknow, India. Photo: Tom
Pietrasik/Oxfam
WORKING FOR THE FEW
Political capture and economic inequality
Economic inequality is rapidly increasing in the majority of countries. The wealth of the world is divided in two: almost half going to the richest one percent; the other half to the remaining 99 percent. The World Economic Forum has identified this as a major risk to human progress. Extreme economic inequality and political capture are too often interdependent. Left unchecked, political institutions become undermined and governments overwhelmingly serve the interests of economic elites …show more content…
Based on those surveyed, inequality is ‘impacting social stability within countries and threatening security on a global scale.’ Oxfam shares its analysis, and wants to see the 2014 World Economic Forum make the commitments needed to counter the growing tide of inequality.
Some economic inequality is essential to drive growth and progress, rewarding those with talent, hard earned skills, and the ambition to innovate and take entrepreneurial risks. However, the extreme levels of wealth concentration occurring today threaten to exclude hundreds of millions of people from realizing the benefits of their talents and hard work. Extreme economic inequality is damaging and worrying for many reasons: it is morally questionable; it can have negative impacts on economic growth and poverty reduction; and it can multiply social problems. It compounds other inequalities, such as those between women and men. In many countries, extreme economic inequality is worrying because of the pernicious impact that wealth concentrations can have on equal political representation. When wealth captures government policymaking, the rules bend to favor the rich, often to …show more content…
A pernicious result is the skewing of public policy to favor elite interests, which has coincided with the greatest concentration of wealth among the richest one percent since the eve of the Great Depression.
As policies favoring corporations gained ascendancy, the bargaining power of labor unions plummeted and the real value of the minimum wage and other protections eroded. It is now harder for unions to organize, and easier for big businesses to suppress wages and erode workers’ benefits.
Wealthy interest groups have also used their financial might to influence legislators and the general public to keep downward pressure on top income tax rates and capital gains, and to create corporate tax loopholes.
Because capital is taxed at lower rates than income, millions of average working Americans pay higher tax rates than the rich.
From the 1980s onwards, the financial and banking sectors pumped millions of dollars into undoing regulations put in place after the