Richest 1 percent own nearly half of world's wealth

[Martok]

Goodness knows I don't favor Obama-style (or any other -style) socialism -- I realize only too well it would merely make a bad situation even worse in the long run -- but I can't deny numbers like this do bother me. 

At the very least, it's far from an ideal situation.  I just have no idea how to "fix" it (or if it even can be fixed). 

Almost half of the world's wealth is owned by just 1 percent of the world's population, according to the authors of a report published just days before the start of the World Economic Forum's annual meeting in Davos, Switzerland, where the topic of rapidly increasing income disparities will be a major focus.

In its study titled "Working for the Few," the British-founded development charity Oxfam concludes that the $110 trillion wealth of the 1 percent richest people on the planet is some 65 times the total wealth of those floundering at the "bottom half" of the world's population.

Further, this "bottom half" now owns the same as the richest 85 people in the world and the wealthiest grew their share of bounty in 24 out of 26 countries surveyed between 1980 and 2012, the study says. The research was compiled using data from Credit Suisse's World Wealth report and the Forbes' billionaires list.

"In the last 30 thirty years seven out of 10 people have been living in countries where economic inequality has increased," Nick Galasso, one of the co-authors of the study, told USA TODAY. "This a trend that has been unfolding globally for the last two or three decades. What we've not seen is any political will toward curbing it."

President Obama has identified economic equality as one of the defining issues of our time and in a speech in Dec. last year he said that increasing inequality "challenges the very essence of who we are as a people." In the U.S., the financially privileged — the wealthiest 1 percent — have "captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer," the Oxfam report notes.

"This massive concentration of economic resources in the hands of fewer people presents a significant threat to inclusive political and economic systems. Instead of moving forward together, people are increasingly separated by economic and political power, inevitably heightening social tensions and increasing the risk of societal breakdown," the report says.

The WEF has identified income inequality as one of the greatest risks facing the world in 2014, and it will be a big topic of discussion during the organization's annual meeting that runs from Jan. 22 to Jan. 25.

"(Oxfam's report) is a further confirmation that the global economy is twisted out of shape," says Philip J. Jennings, the general secretary of the UNI Global Union, an international federation of unions based in Geneva. "These are levels of inequality that we have not seen since the 1920s."

[Steelgrave]

Best duck and cover....when I brought this up in a similar thread, you would think I had voted for the Socialist Party for the last 30 years instead of voting Republican every election, which I have. And when you look at how the wealth of the 1% has grown over the last 20 years in proportion to even the next wealthiest 1%, it's pretty staggering.

[Steelgrave]

whoopsie

[Keunert]

when i was your age boys, the richest one percent actually owned half of the population.
you should admit that this is a progress before LB steps in

[Mr. Bigglesworth]

The 3rd Renaissance that will not be.

Some might want to create a world where people spend half of what is now their work day pursuing personal advancement be it craft, academic, community service, etc. Technology is such that people could apply their resources to that end. Imagine the rate of advancement with the current levels of education, information availability, new technology.

Sadly it will not be. The banks have convinced the governments that human productivity is not achieved when people pursue their goals but when they make a few people extraordinarily wealthy. Wealthy to the point it is just a game of one upmanship. Governments want to get as much tax dollars ASAP so they go along with it.

[GDS_Starfury]

shit... when Windy was a young lad he owned half the worlds wealth and that was a frikin seashell.

[BanzaiCat]

Had something to do with the Manhattan Island purchase from the natives, did he?

I'm not surprised this is how things are. What surprised me was seeing a story on NBC News yesterday on this exact subject and exactly how evil the anchor painted this as; he even injected underlying hints towards rioting and rebellion. I just love the news and how they never attempt to stir people's emotions.

In the meantime, I'm working on being part of that 1%. I'll likely never make it, but one must dream.

[endfire79]

(posted in the wrong part of the forum, sorry!)

[airboy]

Goodness knows I don't favor Obama-style (or any other -style) socialism -- I realize only too well it would merely make a bad situation even worse in the long run -- but I can't deny numbers like this do bother me. 

At the very least, it's far from an ideal situation.  I just have no idea how to "fix" it (or if it even can be fixed). 

Almost half of the world's wealth is owned by just 1 percent of the world's population, according to the authors of a report published just days before the start of the World Economic Forum's annual meeting in Davos, Switzerland, where the topic of rapidly increasing income disparities will be a major focus.

In its study titled "Working for the Few," the British-founded development charity Oxfam concludes that the $110 trillion wealth of the 1 percent richest people on the planet is some 65 times the total wealth of those floundering at the "bottom half" of the world's population.

Further, this "bottom half" now owns the same as the richest 85 people in the world and the wealthiest grew their share of bounty in 24 out of 26 countries surveyed between 1980 and 2012, the study says. The research was compiled using data from Credit Suisse's World Wealth report and the Forbes' billionaires list.

"In the last 30 thirty years seven out of 10 people have been living in countries where economic inequality has increased," Nick Galasso, one of the co-authors of the study, told USA TODAY. "This a trend that has been unfolding globally for the last two or three decades. What we've not seen is any political will toward curbing it."

President Obama has identified economic equality as one of the defining issues of our time and in a speech in Dec. last year he said that increasing inequality "challenges the very essence of who we are as a people." In the U.S., the financially privileged — the wealthiest 1 percent — have "captured 95 percent of post-financial crisis growth since 2009, while the bottom 90 percent became poorer," the Oxfam report notes.

"This massive concentration of economic resources in the hands of fewer people presents a significant threat to inclusive political and economic systems. Instead of moving forward together, people are increasingly separated by economic and political power, inevitably heightening social tensions and increasing the risk of societal breakdown," the report says.

The WEF has identified income inequality as one of the greatest risks facing the world in 2014, and it will be a big topic of discussion during the organization's annual meeting that runs from Jan. 22 to Jan. 25.

"(Oxfam's report) is a further confirmation that the global economy is twisted out of shape," says Philip J. Jennings, the general secretary of the UNI Global Union, an international federation of unions based in Geneva. "These are levels of inequality that we have not seen since the 1920s."

I question the validity of this study.  I have never, ever seen any claim like this before.  I follow US income distribution very carefully and this does not come even close to holding true in the USA.

Next, measuring "wealth" is very difficult.  What is the value of a piece of land which is not for sale?  What is the value of an ongoing business that is not publically traded?  Is the wealth represented by these assets actually counted by Oxfam?  I have my doubts.

You can get US income data easily and see the breakdowns by percentile at www.taxfoundation.org
The latest data is: http://taxfoundation.org/article/summary-latest-federal-individual-income-tax-data-0

If you look at the data, the top 1% of income in the USA was $344k. 

[Staggerwing]

The article is about global wealth, not just US wealth. There are a lot of soul-crushingly poor people out there in the World- more than enough to sharply skew the numbers away from matching US results, which have to be among the top few countries'.

[airboy]

The article is about global wealth, not just US wealth. There are a lot of soul-crushingly poor people out there in the World- more than enough to sharply skew the numbers away from matching US results, which have to be among the top few countries'.

My point is that it is very hard to measure wealth.  There are no clear measures of wealth in the USA where there is a lot of economic data collection.  If the USA wealth data is poor - how good is the rest of the world?

I know there are a lot of countries where the poverty rate is horrid (like Haiti).  But overall in the world with freer trade and the collapse of the USSR, standards of living have gone up considerably in underdeveloped countries compared to almost any period in the last 200 years.  This fact is well known, but flies in the face of this report.  In sum, I doubt the validity of the data in this study.

[bayonetbrant]

Airboy -

what impact would there be on "wealth" stats if we quit counting things like stock options as part of someone's total income?

Seems to me a lot of the "wealth" owned by the top 1% or so are thngs that you can't walk into the store and hand over for a loaf of bread, and that's a big part of where the inequality might be coming from.  When you "wealth" continues to rise based on today's price for a stock in a company, which is (in large part) someone else's valuation of that piece of paper and guaranteed by no one, is it truly "wealth"?

Am I completely misreading things?

[Mr. Bigglesworth]

Airboy -

what impact would there be on "wealth" stats if we quit counting things like stock options as part of someone's total income?

Seems to me a lot of the "wealth" owned by the top 1% or so are thngs that you can't walk into the store and hand over for a loaf of bread, and that's a big part of where the inequality might be coming from.  When you "wealth" continues to rise based on today's price for a stock in a company, which is (in large part) someone else's valuation of that piece of paper and guaranteed by no one, is it truly "wealth"?

Am I completely misreading things?

Yes. You cant take your house to a store for a loaf of bread either, that does not change the fact that for most people it is their biggest item of wealth. Wealth is measured off the balance sheet as the net of assets - liabilities. The only things that are easy to measure are property, bank assets (accounts, investments, loans) and vehicles. The rest such as your furniture, dishes, the clothes on your back, whatever, are not counted. Most assets are owned by businesses. A house is nothing to planes, ships, highrises, etc. So most wealth is owned by shareholders.

If you try to hide shareholdings you hide most of the world's real wealth.

Many things counted as investments are repacked BS. The only thing real about them is somebody may buy it.

[airboy]

I mostly agree with Mr. Bigglesworth.
Weath = Assets - Liabilities

For most households, wealth is in homes, vehicles, savings, retirement and investments.

But business wealth is very hard to measure.  The value of an ongoing business which is properly managed can be very high.  The same business run by an average manager has a lower value.  And a lot of business ownership is sole proprietorship or a partnership which is not traded on the stock market.  Providing an accurate "asset value" of a privately held business is quite difficult.

Some measures of wealth are easy to assess.  You own a stock or bond - what is the sales price today?  For a home - this is a harder question to answer.  Raw land - even harder  For the value of an ongoing business - this is much harder to assess.

But very few countries measure wealth.  Most tax (and measure) income which is a very different matter.
This is why I doubt the validity of the study.

On a side note - each year at the end of the year I try to measure my net worth.  Assessing my debts is very simple.  Assessing the value of my financial investments is very simple.  But assessing the value of my home, raw land that I own, and valuing ongoing businesses that I own is impossible and I make do with informed guesses.  And most of my assets are privately held, not publically traded, and thus very difficult to determine an asset value.  I've been an expert witness in court cases assessing the value of ongoing businesses.  My analyses usually stand up under examination.  But my analyses usually state that there is a wide latitude of possible asset values because the actual "cash price" is quite different from the value of the business as an ongoing operation.  So I've looked at this from a personal standpoint, from the standpoint of a teacher/researcher looking at market values and target market profitability, and from the standpoint of an expert testifying under oath or preparing a report under oath.

[Mr. Bigglesworth]

MB is easier than Mr. Bigglesworth. I should have picked a shorter name.