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An interesting milestone

Written By: - Date published: 4:22 pm, January 19th, 2015 - 37 comments
Categories: capitalism, class war, Economy - Tags: , ,

An interesting milestone is about to be passed:

Half global wealth held by the 1%

Oxfam warns of widening inequality gap, days ahead of Davos economic summit in Switzerland

Billionaires and politicians gathering in Switzerland this week will come under pressure to tackle rising inequality after a study found that – on current trends – by next year, 1% of the world’s population will own more wealth than the other 99%.

So what? Well…

Pope Francis and the IMF managing director Christine Lagarde have been among those warning that rising inequality will damage the world economy if left unchecked, while the theme of Thomas Piketty’s best-selling book Capital was the drift back towards late 19th century levels of wealth concentration.

Raising concerns about this state of affairs is not “the politics of envy” (or if it is, then by the same token defending it is “the politics of greed”). A more equal society is more productive. It is also happier and healthier. Just how long can the current trends continue?

37 comments on “An interesting milestone ”

  1. In before “politics of envy” 😛 (besides in the post itself!)

  2. Anecdote from Gladwell’s Outliers

    In Roseto, virtually no one under 55 died of a heart attack, or showed any signs of heart disease. For men over 65, the death rate from heart disease in Roseto was roughly half that of the United States as a whole. The death rate from all causes in Roseto, in fact, was something like thirty or thirty-five percent lower than it should have been.

    “There was no suicide, no alcoholism, no drug addiction, and very little crime. They didn’t have anyone on welfare. Then we looked at peptic ulcers. They didn’t have any of those either. These people were dying of old age. That’s it.”

    What [researcher] Wolf slowly realized was that the secret of Roseto wasn’t diet or exercise or genes or the region where Roseto was situated. It had to be the Roseto itself. As [researchers] Bruhn and Wolf walked around the town, they began to realize why. They looked at how the Rosetans visited each other, stopping to chat with each other in Italian on the street, or cooking for each other in their backyards. They learned about the extended family clans that underlay the town’s social structure. They saw how many homes had three generations living under one roof, and how much respect grandparents commanded. They went to Mass at Our Lady of Mt. Carmel Church and saw the unifying and calming effect of the church. They counted twenty-two separate civic organizations in a town of just under 2000 people. They picked up on the particular egalitarian ethos of the town, that discouraged the wealthy from flaunting their success and helped the unsuccessful obscure their failures.

    In transplanting the paesani culture of southern Italy to the hills of eastern Pennsylvania the Rosetans had created a powerful, protective social structure capable of insulating them from the pressures of the modern world. The Rosetans were healthy because of where they were from, because of the world they had created for themselves in their tiny little town in the hills.

    “I remember going to Roseto for the first time, and you’d see three generational family meals, all the bakeries, the people walking up and down the street, sitting on their porches talking to each other, the blouse mills where the women worked during the day, while the men worked in the slate quarries,” Bruhn said. “It was magical.”

    • A good connection ropata:rorschach.

      It’s a classic study that shows that a thoroughly embedded, intricately interlinked and therefore inevitably supportive social structure is the ‘habitus’ we’re built for – both physically and psychologically.

      One of the great paradoxes of today’s world is that individualism is the antithesis of what is good for individuals.

      Economic inequality and competitive individualism go hand in hand – they feed off each other. A focus on money is known, from the research, to be associated causally with self-centredness and a lack of empathy.

      In Kahneman’s book ‘Thinking, fast and slow’ he summarises the research on how thinking of money primes us like this (pp. 55-56):

      Reminders of money produce some troubling effects.

      … Money-primed people become more independent than they would be without the associative trigger. They persevered almost twice as long in trying to solve a very difficult problem before they asked the experimenter for help, a crisp demonstration of increased self-reliance. Money-primed people are also more selfish: they were much less willing to spend time helping another student who pretended to be confused about an experimental task. When an experimenter clumsily dropped a bunch of pencils on the floor, the participants with money (unconsciously) on their mind picked up fewer pencils. In another experiment in the series, participants were told that they would shortly have a get-acquainted conversation with another person and were asked to set up two chairs while the experimenter left to retrieve that person. Participants primed by money chose to stay much farther apart than their nonprime peers (118 vs. 80 centimeters). Money-primed undergraduates also showed a greater preference for being alone.

      The general theme of these findings is that the idea of money primes individualism: a reluctance to be involved with others, to depend on others, or to accept demands from others. … [Kathleen Vohs’] findings suggest that living in a culture that surrounds us with reminders of money may shape our behaviour and our attitudes in ways that we do not know about and of which we may not be proud.”

      Contrast that with the Roseto findings and you get a sense of where at least some of our problems with anxiety and depression come from.

      • vto 2.1.1

        “One of the great paradoxes of today’s world is that individualism is the antithesis of what is good for individuals.”

        great reality check there puddleglum

        hello righties out there? WAKE UP !

    • Jenny Kirk 2.2

      ” …….or cooking for each other in their backyards. They learned about the extended family clans that underlay the town’s social structure. They saw how many homes had three generations living under one roof, and how much respect grandparents commanded ….”

      I wonder if Maori would see any connection in this description of the “ideal Lifestyle” ?

    • saveNZ 2.3

      Great post.

  3. Lanthanide 3

    “A more equal society is more productive. It is also happier and healthier. ”

    It’s also likely to consume more, and thus drive us over the collapse cliff that much faster.

    • dv 3.1

      Thank god the ultra rich are saving us.
      So the poor can’t spend too much to live.

    • Descendant Of Sssmith 3.2

      Well using the above as an example they might actually consume less.

      More time to socialise rather than consume could certainly reduce significantly the rate of collapse.

      Consumption is predicated on growth rather than just using what we need to.

      I can think of many people who if they were happier would spend less on stuff they didn’t really need.

      • Colonial Rawshark 3.2.1

        And if the stuff which we bought lasted, instead of breaking after only year or two of use.

      • Foreign waka 3.2.2

        Lets start with stopping the import of these cheap container lots full of cr….

      • Draco T Bastard 3.2.3

        Consumption is predicated on growth rather than just using what we need to.

        This is incorrect. Growth is based upon ever higher consumption. That’s why, after 9/11, GWB stood up and told people to go spend.

        • For the last 30 years, this mystical panacea of “Growth” has been touted by pollies as the answer to all problems. But it was a bait and switch, we all worked harder, GDP and productivity went through the roof, but all the gains went to the 1%. That is why EQUALITY is the only policy that makes sense for improving the future of mankind and the planet. “Growth” has done its dash.

    • Colonial Rawshark 3.3


      What we need are the societal systems and values in place which allow people to lead fulfilling active lives with much less consumption. Absolutely do-able. But as yet, the vision for this has not been articulated politically.

      • indiana 3.3.1

        Are you suggesting governments should control how the people consume…or leave it up to their own free will?

        • Colonial Rawshark

          Government controls over how people consume are definitely coming. Certain implicit and explicit controls are already here of course.

          The smartest thing to do though, is community, family and individual self regulation, like olden times.

          • Skinny

            Less is more I agree totally. However regulating a partners spending habits can be a battle. My offsider said to me yesterday got any plans today, before I could answer she says how about we go shopping, I replied what do you need, she says I wouldn’t mine having a look at some stuff. I sighed and said If you have something you need that’s fine, if not how about we go for a Sunday drive a little later when its cooler and give the little dog a run. So we did less the unnecessary spend, an enjoyable day had by all.

        • Descendant Of Sssmith

          Government controls consumption now to some extent via regulation.

          Some controls that used to exist have been relaxed eg the rules resulting in a massive increase in the vitamin and supplements industry as the US owners of these companies gained political power and removed the “snake oil salesman” restrictions that stopped them peddling their crap.

          Cigarette and alcohol are other simple examples.

          Corporations control consumption through often the promotion of fear via advertising. The success of door to door salesman in poor areas selling security systems is the classic example of this, the lady who became a billionaire selling bullet proof school bags for little kids, the sale of large unnecessary Humvees to people who don’t need them as psychologists designed advertising campaigns specifically to prey on peoples fears.

          Your notion of free will as opposed to a manipulated consumer simply doesn’t exist.

          And then there’s the addictive products – the alcohol, the tobacco, the gambling.

          Explain to me how those companies are free to do whatever they want in NZ in the name of consumer free-will?

          You’re trying to portray something that does not exist.

          • Colonial Rawshark

            Of course the other way that consumption is regulated is simply via allocation of national income (who gets most, who gets least) and especially, strict rationing of money to the poor.

        • Draco T Bastard

          There’s a number of steps that need to be taken:

          1. Inform people of the sustainable limit of our resources
          2. Show them how their actions influence the availability of those resources
          3. Let them make up their own mind through effective democratic systems which then determines how those resources are used.

          This does, of course, remove the corporations and business owners power of choosing for us but life’s like that.

        • tracey

          how odd… isnt cannabis illegal, a government control over consumption? So, self harm is a criteria for government control… rampant consumerism “want, want want, gimmie, gimmie, gimmie, more, more , more” may be the most self harm humans have ever done.

      • philj 3.3.2

        It has been articulated politically. Maybe not recently. The McGillicuddy Serious Party addressed all of these concerns in their manifestos about 20 years ago. Possibly too ahead of its time.

    • Draco T Bastard 3.4

      Not necessarily. A more equal society that looked after people could easily have people consuming less and thus become sustainable.

      It is capitalism and it’s drive for ever more useless things and status that drives unsustainability.

    • Al66 3.5

      Stop trying to justify the “politics of greed” – if increased consumerism is a risk then steps need to be put into place to mitigate this, but this should not delay resolving the current levels of virtual Victorian inequality in Aotearoa.

      • Lanthanide 3.5.1

        Lets give everyone money so they can spend it to improve their quality of life.

        Then put rules in place to stop people spending their money because it hurts the environment / long-term stability of industrialised civilization.

  4. Tom Jackson 4

    Meh. Not enough people care.

  5. Weepus beard 5

    Is John Key in the 1%? Poor bastard might miss out having “helped” NZ over the last six years with no pay.

    • Key’s net worth is estimated to be somewhere between $38 and $50 million. So (as at 2011) he was one of the glorious 987,300 people on the planet holding $10 to 100 million. In 2010 global population was approx 6.916 billion, so that puts Key firmly in the top 0.01%.

      But Key is not out of the woods yet. He still has to pay around 2.8% in income tax!

      I don’t know about you but I think this is terrible, and speaks to the urgent need for more tax cuts.

      • Weepus beard 5.1.1

        Heh, that could be a good target question for our left wing activists:

        What percent of his income from 2008 to the present has John Key paid in income tax?

    • Truth Will Out 5.2

      Key has been supported by blind trust since 2008, literally. Blind trust is all that is required to support him, after he was caught with his fingers in the till over KiwiRail. Only a complete and utter idiot would believe his theft as a servant and fraud would have stopped there. His response was to hide it all behind the mechanism of blind trust instead, the same blind trust his supporters hide their stupidity behind. Who cares if he doesn’t draw on his salary. Like every other lie he tells whenever his lips are moving, it”s either a load of crap or just another form of self deception on the part of his deluded worshippers. You can bet your bottom dollar the scumbag has pilfered telephone numbers through his blind trust.

    • Macro 5.3

      “Is John Key in the 1%”?

      Very much so! – Indeed a nett worth of around $800,000 is enough to place one in the top 1% ile.

      But as Roparta notes: it’s really to top 0.01% like Key who really control the wealth.

      The so called “middle incomers” are the ones who the now being screwed most royally by the elite few, their relative nett worth is being depleted by the day – they work more and more hours in an effort to keep up, but in the end it will all be to no avail. They cannot compete with the “money creators” – the banksters et al – who create money out of money day and night for their own ends.

  6. The lost sheep 6

    “A more equal society….. is also happier and healthier.”

    If human societies were that simple there would be a direct correlation evident between ‘gini’ and ‘world happiness’ data?


    Mmmm. Doesn’t seem to be?

    • McFlock 6.1

      Simple facts are not always demonstrated by a simpleton’s simplistic googling.

      Try following some of the links in the post, and then links from those links.

  7. A Voter 7

    Well there is too few people making a whole lot of money out of a lot of other peoples time and those people arent getting paid and those who are making all the money are also hijackin the democratic process of government so that they arent accountable for the loss of wealth to the nation
    I remember something called the Bolshevik Revolution last time it was like this
    Can we skip the First WW and just go straight to the revolution and kick Keys monarchist arse ,piece of efin shit he is

  8. disturbed 8

    Davos is yet just another Elitist Global economic Summit.

    Is FJK going to Davos as he is in Europe now?

    He attended the black ops secretive Bilderberg group Global secret conference in 2011 and we taxpayers have never been told officially of his attendance to this controversial secret group meeting yet ?


    The powerful influential dark secretive “Bilderberg Group” global Elite bunch are now also aggressively plotting to destabilise Governments and take over control one by one, as it is in their agenda according to the US Logan Law 15.

    At Davos the same participants will no doubt be included to carry out their agenda under guise and the jaw wagging will continue as always as they will carry out expanding policy at Davos to consolidate & hold on to power and control.

    The Elite are very desperate to control power, and will seize on this venue as they do always.

    Note; No Bilderberg meeting agenda has ever been made public. “It is the epitome of low-profile dark ops, a shadow government hidden in a doorway.” According to critics and close observers, it’s agenda is to weaken all world leadership but their own. It is also, according to a U.S. law called the Logan Act, [15] illegal:

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    BeehiveBy beehive.govt.nz
    1 week ago
  • Saliva testing expansion for frontline border workers
    All frontline border workers who are required to be regularly tested for COVID-19 will soon be able to choose regular saliva testing as a full replacement for nasopharyngeal testing, COVID-19 Response Minister Chris Hipkins has announced. Saliva testing will be expanded as an option for all those on a regular ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Government consults on freshwater farm plan
    The Government is inviting farmers and growers to provide their practical ideas to help develop high-quality and workable freshwater farm plans, in line with its freshwater goals said Agriculture Minister Damien O’Connor and Environment Minister David Parker. The ministers today released the consultation documents for freshwater farm plans and stock exclusion low slope maps. Comment is being sought on a new, more ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Increased support for midwives
    New measures to help bolster the midwifery workforce as they care for the next generation of New Zealanders, have been announced today by Associate Minister of Health Dr Ayesha Verrall. “New Zealand’s midwives are committed to the wellbeing of women and whānau, but they’re facing significant challenges. The DHB midwifery ...
    BeehiveBy beehive.govt.nz
    1 week ago
  • Prime Minister's Speech to NZIIA Annual Conference
    Ladies and gentlemen, distinguished guests, ata mārie, tēnā koutou katoa. It’s a great pleasure to attend an event on such an important topic as New Zealand’s future in the Indo-Pacific region. Thank you to the New Zealand Institute of International Affairs for bringing this hui together. I am encouraged to ...
    BeehiveBy beehive.govt.nz
    1 week ago