Forest of Dean & Wye Valley

The widening Gap: the rich get richer and the poor get poorer

In R.Richardson on June 30, 2011 at 1:38 pm

The Clarion has on a number of occasions reported on the work of Michael Moore, the American film maker and author – and a continual thorn in the flesh of the US establishment.
In March, Moore delivered a hard-hitting speech to a massive protest in Madison, Wisconsin, days before measures were taken by the Republican administration to severely curtail bargaining rights for public sector workers.
Moore declared that America is not broke. The country is awash with wealth and cash. Only that wealth is in the hands of the uber-rich. The staggering statistic that Moore quotes is that 400 Americans have as much in assets as 155 million Americans combined – half the population.
How, asks Moore, have we managed to let a small group “abscond with and hoard the bulk of the wealth that runs our economy”? The wealthy, contends Moore, have done two smart things. First they control the media, which promotes the idea of the “American Dream”. “You, too, might be rich one day, so be sure to vote for the party that protects the rich man you might one day be.”
Second, the wealthy have created a “poison pill you will never want to take.” In 2008 as the economy threatened to collapse, Wall Street demanded trillions of dollars to avert the crash. The consequences of refusing to bail out the banks would have been too awful to contemplate: “Goodbye savings accounts, goodbye pensions, goodbye jobs and homes and future.”But within a few months bankers and board room executives were paying themselves huge bonuses.
Moore ends his speech on an upbeat note. We have one person, one vote, and there are more of us than there are of them, he declared.
The protest in Wisconsin where Moore’s speech was delivered was supported by hundreds of thousands, but sadly was not successful. Legislation banning public sector workers from trade unions was passed. A message on Moore’s website suggests that Wisconsin was selected as an object lesson.
Certainly there are parallels in the UK to the situation in the USA. Last month, the Sunday Times Rich List (into the thousand wealthiest UK multi-millionaires) was published. Philip Beresford wrote: “Britain’s super-rich… achieved an 18 per cent rise in their collective wealth over the past year.”
The Independent on Sunday quoted from a High Pay Commission report. In the ten years up to 2008 income at the top grew by 64 per cent, whilst that of the average earner increased by only seven per cent. Differentials are expected to increase further. CEOs earn about 145 times the average wage. By 2020 they will be paid 214 times the average.
The Independent debunked several myths that are commonly advanced in defence of these huge salaries and bonuses. Here are just three:
Myth: “Big money is needed to get the best CEOs.”
Fact: That assumes that most are brought in. But 59 per cent of CEOs in the FTSE 100 were already in the company for five or more years.
Myth: “Our high pay is in line with other leading countries.”
Fact: It is significantly higher than the rest of Europe. It is less than in the US, but 170 per cent higher than the rest of the world. 
Myth: “Top earnings have always risen faster than average wages.”
Fact: Until thirty years ago the gap had been decreasing. From 1949 to 1979 the proportion earned by the top 0.1 per cent decreased from 3.5 to 1.3 per cent.
When ordinary people here and in the USA are being called upon to make sacrifices as jobs disappear and prices rise, disquiet turns to anger as they read of bankers’ and CEOs’ obscene salaries and bonuses. David Cameron’s cry of “We’re all in this together” has a distinctly hollow ring.

  1. Quite so. The wealthy control the media as I was to discover in 2003 when my [now} colleague fasted for economic rights form a tent in Chapel Hill NC. I tried to help by contacting media and at first an ABC news reporter took interest.

    I explained that this had begun with a challenge to laissez faire capitalism and she soon dropped me like a hot brick. My fasting colleague told me that her job would have been on the line to publish this. He did however have the ear of Senator John Edwards, who later opened the Center on Poverty Work and Opportunity on the Campus at UNC.

    Terry Hallman had fasted for the US to sign the International Covenant on Economic Social and Cultural Rights and this became part of our social business model in 2004, when I brought him here as an exit strategy. .

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