- Joseph Stiglitz reminds us that inequality isn't an inevitability, but a choice favoured (and lobbied for) by the few who want to remove themselves from the general public:
(W)idening income and wealth inequality in America is part of a trend seen across the Western world. A 2011 study by the Organization for Economic Cooperation and Development found that income inequality first started to rise in the late ’70s and early ’80s in America and Britain (and also in Israel). The trend became more widespread starting in the late ’80s. Within the last decade, income inequality grew even in traditionally egalitarian countries like Germany, Sweden and Denmark. With a few exceptions — France, Japan, Spain — the top 10 percent of earners in most advanced economies raced ahead, while the bottom 10 percent fell further behind.- On the subject of appalling corporate governance, Janet McFarland reports on how even a modest amount of director responsibility is being treated as an outrage by a corporation responsible for polluting land. Apparently, the story goes, if directors are liable for the actions of the businesses they run, their businesses won't feel free to ignore their environmental responsibilities and stick the public with the bill. (And apparently, the story goes, that's somehow a bad thing.)
But the trend was not universal, or inevitable. Over these same years, countries like Chile, Mexico, Greece, Turkey and Hungary managed to reduce (in some cases very high) income inequality significantly, suggesting that inequality is a product of political and not merely macroeconomic forces. It is not true that inequality is an inevitable byproduct of globalization, the free movement of labor, capital, goods and services, and technological change that favors better-skilled and better-educated employees.
Excessive financialization — which helps explain Britain’s dubious status as the second-most-unequal country, after the United States, among the world’s most advanced economies — also helps explain the soaring inequality. In many countries, weak corporate governance and eroding social cohesion have led to increasing gaps between the pay of chief executives and that of ordinary workers — not yet approaching the 500-to-1 level for America’s biggest companies (as estimated by the International Labor Organization) but still greater than pre-recession levels. (Japan, which has curbed executive pay, is a notable exception.) American innovations in rent-seeking — enriching oneself not by making the size of the economic pie bigger but by manipulating the system to seize a larger slice — have gone global.
I see us entering a world divided not just between the haves and have-nots, but also between those countries that do nothing about it, and those that do. Some countries will be successful in creating shared prosperity — the only kind of prosperity that I believe is truly sustainable. Others will let inequality run amok. In these divided societies, the rich will hunker in gated communities, almost completely separated from the poor, whose lives will be almost unfathomable to them, and vice versa. I’ve visited societies that seem to have chosen this path. They are not places in which most of us would want to live, whether in their cloistered enclaves or their desperate shantytowns.
- Meanwhile, Alison takes a closer look at the Cons' actions to make sure increased wealth doesn't find its way to Canadian workers - as their feigned outrage over the use of temporary foreign workers has hit its expiration date.
- And speaking of transparently temporary fixes, Josh Wingrove takes a closer look at the much-ballyhooed oilsands monitoring program set up by tar sands lobbyists and the Alberta and federal governments. And the scheme touted as promising a "improved understanding of the long-term cumulative effects of oil sands development" is set to expire no later than 2015.
- Finally, Althia Raj reports that the Cons' latest prorogation has officially been exposed as nothing but a sad attempt to escape accountability - as the Cons are trying to pretend it never happened in reinstating all of their legislation to exactly where it stood when they declared the previous session to be over. And Ian Bron and Allan Cutler offer some suggestions for the new throne speech.