Income Inequality

I just started reading Naomi Klein’s “The Shock Doctrine”, about the Milton Friedmanite movement for disaster capitalism; the only way to implement a fundamentalist version of capitalism is to rely on or bring about disasters that allow for a blank-slate, unadulterated environment for free markets to work correctly.

Today a report came out from the Center on Budget and Policy Priorities, which stated:

“As a result, the share of the nation’s income flowing to the top 1 percent has increased sharply, rising from 15.8 percent in 2002 to 20.0 percent in 2006. Not since 1928, just before the Great Depression, has the top 1 percent held such a large share of the nation’s income. (See Figure 1.) In 2000, at the peak of the 1990s boom, the top 1 percent received 19.3 percent of total income in the nation.”

Since 1928. The inference is that, since many believe that income inequality has a high correlation with social unrest and economic collapse (since too few people are benefiting), we might be heading towards a violent time where the inequality will be rectified, one way or another.

If the financial services trough continues to deepen, with a system that has become less and less involved in more peoples’ lives, then recession could quickly accelerate.

I met Klein at the Achievement Summit and sat at the same table as her for lunch. She was very sweet, talkative, but you could tell she was pissed off at a lot by the comments she would make.

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Filed under Economics, Policy

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