Rising Capitalism With capitalism of some sort being prevalent in almost all major countries in the world, other ideologies have taken a backseat. Markets have well and truly captured the whole world and has now intruded into almost all facets of human life. However the unbridled expansion where everything and everyone is up for sale […]
Cadmium Tellurium Thin Film Solar Technology championed by thin film solar panel leader First Solar is set to become a victim of capitalism’s creative destruction as cheap crystalline silicon panels from China have forced Abound Solar and GE to down shutter on their factories. Note Cd-Te which is the largest selling thin film technology in […]
The rising income inequality throughout the world is sowing seeds of dystopia according to a report released by World Economic Forum. The biggest risk amongst the 50 risks listed is the increasing wealth gap between individuals in all countries. Gini’s coefficient has risen in most countries developing as well as developed and this has a strong correlation to globalization. The global artitrage of labor has tilted the scales towards capital and increasingly made wages become stagnant. Developing countries with weak institutions are showing income inequality in horrific forms with $2 billion homes existing in the middle of millions surviving on less than $2 day. US has already seen the OWS movement as a result of this increasing income gap between the have and have nots. Middle Eastern countries have also seen revolutions brought upon by the massive riches of the elite compared to the rising poverty of the poor and even the middle classes.
Income Inequality is a Theme that is getting played across the world in developing as well as developed nations.Most of the turmoil in 2011 in the Middle East and the Occupy Wall Street Movement can be attributed to the growing Income Gap between the Have and Have -Nots.The Great Recession in 2008 can also be looked upon as a fallout of this.Gini’s Coefficient which measures the income distribution gap has shown continued deterioration all over the world.The Middle Class is shrinking and growing poor by the day and it is not only the Poor Class that is getting affected.
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 been increasing 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 apparent in the fact that only 24 million workers out of 300 million urban workers earn more than $6500 per year .
India’s Income Disparity is not growing among the rich and the very poor but also widening between its super rich and middle classes.Note India’s Middle Class is not as big as a percentage of the population in the developed countries and its per capita income is also much lower.However India’s Middle Class is growing as the economy grows by 8-9% and despite the lopsided economic growth some of the massive wealth that is being generated does trickle to the middle class.However those gains are being eroded by a Persistent Double Digit inflation which has entrenched itself.Despite periodic interest rate increases,India’s Central Bank has miserably failed on the Inflation Front in the last couple of years.First it was having too loose a policy to overcome the effects of the global eco crisis in the aftermath of the Lehman collapse.Now it was too slow to raise rates as commodity price increased dramatically.