Gap between rich and poor becoming even wider
A recurrent theme of this blog is that inequalities in income, wealth and power are damaging to social cohesion and individual life chances. Therefore an up-dated transnational study of income inequality in developed countries – including the UK and the USA – provides compelling messages.
The gap between rich and poor in OECD countries has reached its highest level for over over 30 years, and governments must act quickly to tackle inequality, according to a new OECD report. “Divided We Stand: Why Inequality Keeps Rising” finds that the average income of the richest 10% is now about nine times that of the poorest 10 % across the OECD.
The income gap has risen even in traditionally egalitarian countries, such as Germany, Denmark and Sweden, from 5 to 1 in the 1980s to 6 to 1 today. The gap is 10 to 1 in Italy, Japan, Korea and the United Kingdom, and higher still, at 14 to 1 in Israel, Turkey and the United States. In Chile and Mexico, the incomes of the richest are still more than 25 times those of the poorest, the highest in the OECD, but have finally started dropping.
The situation is particularly bad in the UK where the average income of the richest 10% of earners in the UK was almost twelve times that of the bottom 10% of the population by 2008, up from eight times in 1985 and above the European ratio of nine to one.
In today’s “Guardian” newspaper, an editorial states:
“All countries are unequal, but some are more unequal than others. In a report which ranged across the rich countries that make up its membership, the OECD has said that the rich-poor gap had widened across the developed world, but that it had grown especially fast in Britain. During the last quarter of the 20th century in particular, a period dominated by the 18 years of Conservative rule that began in 1979, the UK witnessed the sharpest of rises in inequality. Reading between the lines of the report made plain that this was, in no small part, a matter of political choice.”
Political choices continue to be made and the speed and nature of the Coalition Government’s deficit reduction programme will undoubtedly increase further the economic inequalities in the UK.