Bridging the Income Gap

When business talks about inequality, it’s time to worry

Via The Globe and Mail: When business talks about inequality, it’s time to worry. Excerpt:

As nations steel themselves to provide more taxpayer-funded cash to stave off a new round of defaults while cutting supports for taxpayers, policy makers are pointing to rising income inequality as cause for concern in a climate of growing instability. 

Notably, it’s not the usual voices of the left sounding the alarms, but pro-market heavyweights like the Conference Board of Canada and the International Monetary Fund. 

That such groups are worried should be a signal to Canada’s private sector leaders: pay attention to the compensation gap between your lowest paid worker and that of the CEO, because those differences may tell us a lot about the mess we’re in. After all, businesses rely on the rising purchasing power of the many, not the few, to deliver growth and profits. 

But income inequality has grown more rapidly in Canada than in the U.S. lately, according to the Conference Board report. Among 32 OECD nations, Canada has gone from better-than-average to worse-than-average levels of inequality since the mid 1990s, slumping from 14th to 22nd place, despite a decade of robust economic growth and record levels of job creation. Meanwhile, 15 OECD nations -- including peers like Norway and the U.K. -- were reducing income inequality.

Its earlier report noted: “[H]igh inequality can diminish economic growth if it means that the country is not fully using the skills and capabilities of all its citizens or if it undermines social cohesion, leading to increased social tensions. Second, high inequality raises a moral question about fairness and social justice.” The links between rising inequality, halting economic growth and increasing volatility are getting harder to ignore.

Big media afraid to take Wall Street protest seriously

Via The Tyee: Big Media Afraid to Take Wall Street Protest Seriously. Excerpt:

It's been over a week now of protests, meetings, and confrontations with police on Wall Street, and yet mainstream North American media outlets, who have provided us with daily updates on uprisings in Egypt, Libya, and Spain, to name a few, have given either thin or dismissive notice to what is happening on Manhattan. 

Known as the Occupy Wall Street campaign, it started on September 17 with thousands marching into New York's financial district, waving slogans such as "Wall Street is Our Street" and "We are the 99%." Cops were waiting for the crowds on Wall Street, so they set up camp a block away and have been there ever since, day and night. 

Fueling these protests is the widening gap between the wealthy and everyone else, which continues to grow because of rising unemployment and mortgage foreclosures. 

In other words, this is a much different kind of movement from the tax-cut loving Tea Party protests that the media eagerly covers. This might make more sense when one considers that the Tea Party protests are funded by the ultra-right billionaire Koch Brothers, and treated as a grassroots mega-story by Rupert Murdoch's Fox News. 

The Murdoch-owned Wall Street Journal has run a handful of stories on Occupy Wall Street, seeming to take a close interest only when protesters began being arrested. 

On the day the protest launched, CNN filed the story not as general interest news about a developing social movement, but as a business item. The story was published on CNNMoney, which advertises itself as "A service of CNN, Fortune and Money." 

The New York Times tucked its September 23 story into its regional section (as if this weren't a story of significance beyond New York) and topped the supposed news piece with a dismissively biased headline: Gunning for Wall Street, With Faulty Aim. 

In case readers didn't get the point, the writer's snide asides included describing Occupy Wall Street as "a diffuse and leaderless convocation of activists against greed, corporate influence, gross social inequality and other nasty byproducts of wayward capitalism not easily extinguishable by street theater."

Canadian income gap widening faster than in US: Conference Board

Via The Tyee: Canadian income gap widening faster than in US: Conference Board. Excerpt:

Income inequality in Canada has been rising since the mid-1990s, the Conference Board of Canada says. And the gap is growing faster here than in the US. 

In a news release, the Conference Board's President and CEO Anne Golden said: 

"Canada had the fourth largest increase in income inequality among its peers. Even though the U.S. currently has the largest rich-poor income gap among these countries, the gap in Canada has been rising at a faster rate. 

"As we highlighted in our analysis of Canadian income inequality in July, high inequality both raises a moral question about fairness and can contribute to social tensions. In Canada, the gap between the rich and poor has widened over two decades, especially compared to our peer countries." 

The release noted that the "Gini index," a widely used measure of inequality grew in Canada from 0.293 in the mid-1990s to 0.320 in the late 2000s. A Gini index under 3 is an indicator of low income inequality. Meanwhile, the US Gini index rose from 0.361 to 0.378 in the same period.