| Topic: | Income inequality and the 'small state' | |
| Posted by: | David McLoughlin | |
| Date/Time: | 24/05/12 10:22:00 |
| Something's being missed in this debate. Here's a quote from the 2011 OECD report 'Divided we stand: Why Inequality keeps rising' 'Even within the group of top income earners, incomes became more concentrated (Atkinson et al., 2011). In the United States, for instance, the share of the top 0.1% in totalpre-tax income quadrupled in the 30 years to 2008. Just prior to the global recession, the top 0.1% accounted for some 8% of total pre-tax incomes in the United States, some 4-5% in Canada, the United Kingdom, and Switzerland, and close to 3% in Australia, New Zealand,and France (Chapter 9).' In the US , in 2008, the top 1% had 20% of pre-tax income. At the same time, tax rates on the highest incomes have fallen sharply. It's not surprising that the top 0.1% are demanding that the cost of the crisis be borne by everyone else. They're the one's that fund Grover Norquist in the USA and his 'no-tax increase pledge' which has led to the congressional deadlock. The 'useful idiots' of the TaxPayersAlliance peddle the same bullshit here. Advanced capitalist economies need an educated and healthy workforce. And that workforce expects a long and healthy retirement. That's the difference between the 1930's and the 2010's. All the industrialized nations spend large amounts on education, health-care and pensions. They vary in what is paid for from tax and what is paid from private incomes. In the US, for example, 8% of GDP is spent by the Government on health-care and about the same comes from the private sector. Given that this model is notably wasteful and inefficient compared to ,say, France why does the TPA want to spread the model to Europe? Why are they so opposed to Obamacare? Thirty years ago the Conservative Government encouraged workers to give uo the second state pension and invest in private pensions. All in the cause of a 'smaller state'. The result has been a miserable failure and a fraud on private pensioners. The only people who benefited are the fund managers and pension providers. It is the taxpayer who will pick up the tab via pension credit and income support. 'Small state' equals inefficient and inequitable provision of health care, education and pensions. Once bitten, twice shy. |