24 Jan 2014
According to a new UNDP report, to be launched next week, income inequality increased by 11% in developing countries between 1990 and 2010. Photo: Kibae Park/UN.
Seven out of ten people live in countries where economic inequality has increased in the last 30 years. In a paper released this week, Nick Galasso, from Oxfam America, and I explore the current growing concentration of income and political capture. Firstly: The rich are getting richer, faster. The poorest half of the world's adults, 3.5 billion people, own a total of $1.7 trillion worth of assets. That is similar to the wealth owned by the world's richest 85 people. In the US, the wealthiest one percent captured 95 percent of post-financial crisis growth between 2009 and 2012, while the bottom 90 percent became ever poorer. Secondly: This growing concentration of income and wealth is closely associated with political power and influence. It sounds obvious but it's very easily forgotten. Either through lobbying, campaign finance, or avoiding regulation, the rich exert their power over how the rest of society is governed. In Working for the Few we explore the mechanism by which wealth brings political influence, which in turn breeds greater wealth for a select few. The lopsided influence of the wealthy occurs through different channels. Take the example of Mexico and Carlos Slim. Slim is the CEO and Chairman of