Income disparity | Green World Investor

China lowers Tax on Poor as Rising Inflation,Income Inequality (Gini Coefficient at 0.47) reaches Dangerous Levels

30 Jun, 2011

China has increased the tax exemption limits for urban workers by 80% to $540 a month as soaring inflation and rising income inequalities has reached dangerous levels.Note increasing corruption and vast income inequalities have led to increasing incidences of violence and riots in the country.The prices of essential commodities like food and fuel have increased rapidly like in the rest of the developing world.Despite the central bank increasing interest rates,the prices have hardly moderated.Pork prices have touched new records making the life of the poorest quite unbearable.Note Gini’s coefficient in China has reached 0.47 which is very high.While economic prosperity has increased,a vast section of the population remains poor.This is plain in the fact that only 24 million workers out of 300 million urban workers earn more than $6500 per year .

China eases tax burden on poor with law change

The Standing Committee of China’s legislature raised the minimum personal income required to pay taxes from 2,000 yuan ($300) a month to 3,500 yuan ($540).That will reduce the number of taxpayers from 84 million, or 28 percent of workers covered by the law, to about 24 million, or just 7.7 percent, said a tax official, Wang Jianfan. The income tax law covers about 300 million urban workers but not most of China’s hundreds of millions of farmers, who pay tax under a different system.

India is facing the same problems where income inequality and growing corruption has made the population grow quite angry.$2 billion homes (Mukesh Ambani) being constructed in the same city housing the biggest slum in the world (Dharavi)is not helping matters.The ministers and big businessmen are being caught in huge scams which has incensed even the middle class population of the country leading to a successful agitation against corruption by civil society led by Anna Hazare.So far the Indian government has not done much failing much except for some social sector schemes unleashed during the last election.Rising fuel and food prices are increasing strains while shocking unemployment/underemployment among workers remains rampant.The poor class is facing the worst as most of their earnings go towards food and fuel whose prices have risen faster than their incomes.

Inequality in China: Rural poverty persists as urban wealth balloons

In 2010, China’s Gini-coefficient – a measure of how wealth is distributed in a society – stood at 0.47 (a value of 0 suggests total equality, a value of 1 extreme inequality).In other words, inequality in China has now surpassed that in the United States, and surged through the 0.4 level in the mid-2000s.

Despite the continued growth in urbanisation, some 50.3% of China’s mainland population (or 674.15 million people) continue to live in rural areas.In 2010, rural residents had an annual average per capita disposable income of 5,900 yuan ($898). That’s less than a third of the average per capita disposable income of urban residents, which stood at 19,100 yuan ($2,900).

India’s Shocking Income Inequality – 50 Billionaires and 800 Million Desperately Poor

10 Mar, 2011

Income disparity

Income Inequality in India has been rising at an unprecedented rate in the last couple of decades.The opening of the Indian economy has led to even starker levels of income disparity among the very rich and majority of the Indian citizens.The Crushing Income Disparity is seen in the world’s most expensive $2 Billion House set amongst 42% of the world’s hungry children.The latest Forbes report lists 50 Indian Dollar Billionaires with 2 in the Top 10.A 2007 report by the state-run National Commission for Enterprises in the Unorganised Sector (NCEUS) found that 77% of Indians, or 836 million people, lived on less than 20 rupees (approximately US$0.50 nominal; US$2 PPP) per day.The living conditions of the majority have already fallen further with food price inflation between 10-20%.While revolutions have already broken out in much higher per capita countries like Egypt,Libya etc. India remains relatively dormant with a only the large Naxalite movement reflecting the massive income disparity.Makes you question whether capitalism in India has made much sense especially as there has been no spreading of wealth from the top to the bottom.

50 Indian billionaires in global richest club

Indian steel czar Lakshmi Mittal with a net worth of $31.1 billion grabbed the sixth place with net profits of ArcelorMittal, world’s largest steel-maker, rising 18-fold to $2.9 billion in 2010 on recovery in demand for the commodity and higher margins.

Mukesh Ambani with a net worth $27 billion was ranked ninth on the world list, while the head of consumer products to outsourcing giant Wipro, Azim Premji, was next ranked 36th with a net worth of $16.8 billion.

The world’s most powerful country has only Insensitivity and Callousness to give to its weakest citizens

18 Jul, 2010

Income disparity,USA

USA is unarguably the world’s richest and most powerful country after the fall of the Soviet Union in the 1980s.The country is the only superpower left in the world with a both a huge economy and an almost invincible military.However despite the riches,USA remains a deeply unequal country.The income disparity has been steadily rising in the country with its middle classes barely managing to get through.Unlike the social welfare capitalism practised in European countries,US adheres to a more stricter form of capitalism.The current Global Financial Crisis has thrown the weakest sections of US into a considerable state of distress.With high rates of unemployment and global labor cost arbitrage,the poorest citizens of US are bearing the brunt.One in Eight Americans are forced to live on Food Stamps while the true percentage of unemployment is around 20%.The less educated and the young sections of the US society have the highest unemployment rates.

One in eight Americans receives food stamps: U.S – Reuters

Some 37.9 million people — one in eight Americans — received food stamps to help buy food at latest count, the government said on Tuesday as enrollment set a record for the ninth month in a row.Food stamps are the primary federal anti-hunger program. It helps poor people buy groceries. The economic stimulus package boosted benefits by $80 a month for a family of four.

Unemployment Benefits Not Extended to the Most Vulnerable Sections

On top of the unemployment problems,the political wrangling that has become a constant feature of US politics has led to a stop in the extension on unemployment benefits to workers who have not been able to find jobs for a long time.The reason given for the stoppage of these weekly payments is that makes the beneficiaries lazy and less likely to look for jobs.What is forgotten is that the people who have been out of jobs for the longest period of time are the most financially vulnerable.Most of them would have been exhausted mentally,physically and financially.A government that can use Billions if not Trillions of Dollars to bail out the Financial Institutions that were guilty of bringing on this crisis does not have the $388 a week to pay out to these helpless people.It is a classical sense of Capitalism gone awry.

Obama Blasts GOP for Blocking Unemployment Benefits – Daily Finance

President Barack Obama wants Congress to pass an extension of unemployment insurance for the 2.5 million people whose benefits have expired — and he’s using GOP opposition to bludgeon Republicans as heartless politicians who don’t care about the millions of Americans who have lost their jobs during the recession.With passage of the extension highly likely next week — thanks to the appointment of new Democratic senator, Carte Goodwin of West Virginia — Obama is getting his last-minute political shots in.

During his weekly address Saturday, Obama slammed Republican senators for threatening to block the extension because it would add $34 billion to the budget deficit. Obama said the GOP had no qualms about approving billions in budget-busting tax breaks for the wealthy, but when it comes to the unemployed, they’ve suddenly found their fiscal rectitude.

We only eat meat in our dreams and possibly on holidays – Income Disparity in Egypt

6 May, 2010

Egypt,Income disparity

The growth in income disparity around the world is striking.The internationalization of capital and trade has led to increasing amounts of income for the top percentiles of the world population while the bottom percentiles share of income continues to decline.This has not only been happening in developing countries like Russia,India ,Egypt but also in some developed countries like the US. Their are many causes for this disparity but the end result is that its leading to increasing poverty , misery and social unrest. Capitalism practiced by most countries is a form of elite enriching crony capitalism in which the rule of the game totally favor the elites of the society.This leads to ever increasing Gini coefficient and corresponding growth in the level of social problems.

From meat to wages, economic woes fuel Egypt anger - AP

For the past six weeks, Khulud Mustafa has walked past the butcher near her apartment in Cairo’s run-down Ain Shams district, casting wistful looks at the meat hanging outside his shop as the price has steadily risen.

From the equivalent of $8 per kilogram (2.2 pounds), to $9, then $13. When it peaked at more than $14, she stopped looking.

“I asked him, ‘Are you crazy? What are you doing? How can it go up that fast?’” said Mustafa, a 24-year-old housewife with 3 children. “How are we supposed to eat?”

Mustafa’s voice is one in a growing chorus of despair and frustration over rising prices of everything from food to housing in a key U.S. Mideast ally where more than 40 percent of the population of 79 million lives under or near the poverty line.

What’s worrisome for the government is that this anger is showing signs of turning political. The surge in the price of meat — blamed by officials on a “mafia of traders” — has led to a movement to boycott meat. Near daily protests have been held outside parliament on a variety of economic issues, including demands for an increase in the minimum wage, which since 1984 has been stuck at $6 per month. Across the country over the past year, there have been numerous strikes at factories demanding better working conditions and salaries.

The protests have mostly been small, but they cast a spotlight on an income disparity that critics contend goes to the heart of Egypt’s social and economic woes: An ineffective and autocratic regime more intent on preserving its authority and catering to the elite than the needs of the overwhelming majority of its 80 million citizens.

At one recent demonstration outside parliament, protesters spoke of working several jobs to make ends meet. Hussein Suroor, married with four children, said he earns only 425 pounds ($76) a month from his primary job as a technician at a public contracting company.

“The government wants us to be concerned with how we’re going to put food on our tables, so they keep us busy while they rob the country,” Suroor said.

Rida Noman traveled from the Gharbiya province 94 kilometers (59 miles) north of Cairo to show his support. He works as a property tax collector, making 350 pounds, or $63, but has to do carpentry in the evenings to feed his family of five. He broke into laughter when asked if he can buy meat.

“Meat?! We only eat meat in our dreams and possibly on holidays,” he said.

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