A new OECD report has confirmed that social and economic inequality in the majority of industrialized nations has soared since the start of the economic crisis of 2007-8.
In an update to its 2011 report ‘Divided We Stand’, the
Organization for Economic Cooperation and Development has been
describing a widening gap between the developed world’s rich and
poor in the thirty years until 2008. But in this latest report it
claims the process has accelerated in the three years since
2007.
The paper explains that many countries had already been in a
dire state of economic inequality — their highest in decades — and
all the economic crisis did was exacerbate that to the extent that
the already existing economic gaps were multiplied by the crisis
between the years 2007-10.
The report reveals an increase in the difference of how much the
wealthy were able to increase their wealth compared to the poor.
This means that if in 2007, the rich were becoming richer 9 times
faster than the lowest 10 per cent, the difference in what they
accumulated in 2010 compared to the poor was already 9.5
times.
Of the 34 OECD countries, it appears that “the top 10 percent
has done better than the poorest 10 percent in 21 countries,”
with the widest gaps seen in the United States, Turkey, Chile and
Mexico. In the three years described above, their income status had
been continuously plunging by 2 per cent every year.
A majority of the countries experiencing the harshest rise of
inequality were in Europe, where tough EU austerity policies took
hold. Italy and Spain were hit worst. However, a 5 per cent
decrease was seen annually in Iceland, Ireland, Estonia and
impoverished Greece — which still remains on the verge of economic
collapse.
One factor shared by all 34 countries surveyed by the OECD is
children and young people. Whether it is due to unemployment or
poor family living standards, they appear to have it have the
worst.
“Households with children were hit hard during the crisis.
Since 2007, child poverty increased in 16 OECD countries, with
increases exceeding 2 points in Turkey, Spain, Belgium, Slovenia
and Hungary.”
What makes the news grimmer is that cash injections into the
world’s financial elite, via banks and markets, as well as Wall
Street, essentially only helped the uppermost 10 per cent multiply
their wealth. In the years since 2007, their financial portfolios
are said to have grown by a large margin.
But OECD’s data also explains that the economic crisis could not
have been the sole factor in the widening gap between segments of
society and in their redistribution of wealth. There has been a
process that has been exploiting these economic conditions since
2008, via the bankrupting and impoverishment taking place in the
developed world, most likely for the purpose of competing with the
developing world’s working classes and their cheap labor. So there
is a widening base of severely underpaid working class workers
across the entire world. But they don’t get nearly the kind of
social, economic or healthcare benefits the upper layers of society
do.
In the end, it will not get better — the report says. The only
reason that 2010 seemed like the worst year is because the growth
of the conditions of inequality was somewhat halted by many social
state provisions, mostly across Europe. Without them, the report
says the real trouble we are in would be more evident, and so would
its growth in the years to come. What we are seeing now is only the
beginning.
This article originally appeared on : RT