Sitglitz: Money trumps democracy - America has the highest level of inequality of any of the advanced countries

in my travels over the years, i've always been acutely aware of the disparity between rich and poor in many of the countries i've visited... mexico was my first eye-opening experience in the early 70s and, despite the appearance of home depots and sam's clubs that have popped up like poisonous mushrooms after a rain, as of last october, i haven't seen that much change... the poor are still very poor and the rich are still staggeringly rich... i've seen the same story repeated to greater and lesser degrees all over latin america, the balkans (with a few exceptions), africa and, saddest of all, afghanistan...


i always thought that the poor in the u.s., although i know there are some whose circumstances are almost as extreme as in the poorest of third world countries, were poor at a level a bit more comfortable than, for instance, in mexico... i don't think that any more... in the last ten years, especially, i've seen my country slide inexorably toward third world standards with no end in sight...


joseph stiglitz is an acute observer and i offer this only as a way to keep the problem visible...

[T]he American dream is a myth. There is less equality of opportunity in the United States today than there is in Europe – or, indeed, in any advanced industrial country for which there are data.

This is one of the reasons that America has the highest level of inequality of any of the advanced countries – and its gap with the rest has been widening. In the “recovery” of 2009-2010, the top 1% of US income earners captured 93% of the income growth. Other inequality indicators – like wealth, health, and life expectancy – are as bad or even worse. The clear trend is one of concentration of income and wealth at the top, the hollowing out of the middle, and increasing poverty at the bottom.

It would be one thing if the high incomes of those at the top were the result of greater contributions to society, but the Great Recession showed otherwise: even bankers who had led the global economy, as well as their own firms, to the brink of ruin, received outsize bonuses.

A closer look at those at the top reveals a disproportionate role for rent-seeking: some have obtained their wealth by exercising monopoly power; others are CEOs who have taken advantage of deficiencies in corporate governance to extract for themselves an excessive share of corporate earnings; and still others have used political connections to benefit from government munificence – either excessively high prices for what the government buys (drugs), or excessively low prices for what the government sells (mineral rights).

Likewise, part of the wealth of those in finance comes from exploiting the poor, through predatory lending and abusive credit-card practices. Those at the top, in such cases, are enriched at the direct expense of those at the bottom.

i never cease to be amazed at the greed manifested by those at the top and completely baffled at their disregard or even outright contempt for any notion of the common good...

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