World economy will top $100 trillion in 2022 for the first time. But the wealth gap only grows wider.
A system that reproduces inequality remains in tact as we enter the new year.
As the year draws to a close…
I’ve been looking at year-end numbers on the growing wealth gap and taking notes. Let me share some with you.
LONDON, Dec 26 (Reuters) - The world's economic output will exceed $100 trillion for the first time this year. But the coronavirus pandemic has only worsened the massive financial gap between rich and poor around the world.
By the summer of 2021, the World Bank estimated that 97 million people around the world had been pushed into extreme poverty by Covid-19, being forced to live on less than $1.90 a day.
On the other hand, global billionaires last year enjoyed the steepest increase in their share of wealth since the World Inequality Lab began keeping records in 1995, according to the research group's analysis released Tuesday. Their net worth grew by more than $3.6 trillion in 2020 alone.
Global inequality is as marked as it was in the early 20th-century pinnacle of western imperialism after the capture by the super-rich of an increasing share of the world’s income, a new report has shown. — Guardian
While some countries – including the US, Russia, and India – had experienced “spectacular increases” in inequality, other parts of the world, such as European countries and China, had reported relatively modest rises.
Locking in inequality
As the gap continues to expand, baby boomers are set to pass unprecedented wealth to younger generations. More than $84 trillion — along with values — will be handed down in the next 25 years.
Boomers, born between 1946 and 1964, are expected to account for nearly two-thirds of the wealth transfer in a coming era that will witness “the most dollars changing hands that this country, or any country, has ever seen.” — Boston Globe
In the US, redistribution of wealth is based mainly on charitable giving rather than on the system of taxation and social welfare as it is in the social-democratic countries of Europe or socialist countries like China.
Nearly 40 percent of the wealth that will be inherited over the next 25 years will come from just 1.4 percent of American households. Most of that money will go to the heirs of the rich.
As a result, bequests in the coming decades could cement and exacerbate an inequality not seen since the Gilded Age of the late 1800s.
The politics of wealth inequality
Growing inequality has exacerbated other social and economic challenges, including stagnating productivity, increased crime, ill health, and depression. It has also intensified class struggle.
In many countries, including the US, the widening wealth gap during the pandemic has led to a downward spiral and disillusionment with centrist politics and the reemergence of white supremacist, and neo-fascist movements led by populist demagogues. Where a year ago, following the Democratic election sweep, there was hope for significant civil rights reform, substantial pandemic relief, and environmental support, those hopes are fading.
In the coming year, there’s a real likelihood that this neo-fascist movement will regain its majority in congress and set the stage for a Trump election victory in 2024.
The question now is, how should/will Democrats, the progressive left, and the union leadership respond?
Let me hear your thoughts on this in the comments section.