A military crackdown found guilty the journalists could face fifteen years in jail and those are the headlines on aljazeera produce stay with us inside story is coming up next thank you for watching. Wherever you. The gap between wish and poise getting wider most of the worlds wealth generated last year and up in the pockets of people where you have very rich people while millions are struggling simply to survive why cant the world be more equal this is the inside story. Hello and welcome to the program. The rich are getting richer and the poor poorer oxfams latest report on inequality paints a stark picture of a widening gap between the worlds haves and the have nots eighty two percent of Global Wealth generated last year went to the richest one percent of the population for the three point seven billion people who make kept the poorest however the weald there wasnt no increase in wealth oxfam pins much of the blame on the erosion of workers rights and big business having too much influence over government policy making in an attempt to balance the scales that charity is calling for a minimum wage people can live on higher taxes on the rates and more spending on Public Services like health and education according to oxfams data forty two billionaires control as must wealth as the poorest half of the worlds population as of early january amazon boss jeff bezos is the worlds richest man with a fortune topping one hundred billion dollars on a one out of ten of the worlds billionaires women loreal paris Liliane Bettencourt was worth nearly forty billion dollars when she died last year and most billionaires from asia with china are leading the pack its booming economy come produce two new billionaires every week. Lets bring in our panel joining us from london vicky pryce an economist at the center for economics and Business Research for a bat lesson had iraq an m. P. And professor of the fifth University Also in london philip le grande an economist and author of european spring why our economies and politics are in a mess and how to put them right welcome to you all. Let me start by asking mispriced this why has income inequality worsened over the last decade or so. The truth is that income inequality looking across the world has not worsened in the sense that many people have come out of the poverty line hundreds of Million People in china for example but also india are now earning possibly more than they did before but what has been happening while this growth has been going on in a number of countries that are now is are developing in a very reasonable way whats been going on is that in fact the distribution of wealth has not held up in any sensible way so what we found is that in looking at the data from is done that particularly well in that report it is that a lot of the wealth has been concentrated in too few hands in the developing world its been going on of course in the developed for some time but the developing world is suffering significantly from the fact that the money has not been distributed fairly across and people often in very low wages which are able to support them. Is it because of the way business is conducted in the modern time is it because of globalization is there any particular reason why were having this gap. Well i think there is this gap because there is a sense i mean like a lot of leeway that has been given to a lot of rich people in this sense that there are tax breaks there are also. A lot of incentives when the capital moves from the global north to the global south there is also a lot of in there is the theory actually that has been going on for a lot of for for so many decades now that was what is good for the rich is also good for the poor in the sense that the more wealth you create on the upper level then lot of it will go or some of it will go down to the others in terms of job creation in terms of Business Opportunities but what is happening is like there is there is some sort of growth in the wealth worldwide and some of the poorer are less were in some of the countries where the problem is like the share between those who are rich and those who are poor is widening in the sense that there are more people up on the upper level making more money than those who are actually like on the of the poorest kind of levels so i think there is yes its globalization its also theories that exist within governments about how to do business and what is the best way of actually achieving Economic Development missler ground theres a tangle here between the wealth inequality and income inequality if you look at the global a wealth generated sixty seven percent is in europe and the United States of america as a percent in. Africa so is there an element of instability. War conflicts that is very conducive to this situation or do you think war is something intrinsic to the capitalistic system. I think its first of all its important to point out that yes there are very big disparities in Global Wealth and in clovelly income and its important that we try to reduce them at the same time its misleading to suggest that only a few billionaires are benefiting from the Global Economic system and the poorest half of the population are not the share of the World Population living in extreme poverty has fallen from thirty five percent in one nine hundred ninety to ten percent you look at real wages in china of the past decade theyve tripled and the garment workers who the oxfam who oxfam pointed to in their report in vietnam and in baghdad are actually doing much better typically than most people in those economies so i think its quite wrong to suggest that somehow its only benefiting the very wealthiest at the same time that clearly is a big problem and i think partly its due to globalization in the sense that before those who were successful were successful at a local level now they can be successful at a global level the market is much bigger and therefore the rewards of the long the most successful are larger second of all the explosion of the Financial Sector and all the wealth that has been taken by the participants are not necessarily the investors in the in the Financial Sector. And then thirdly youve seen i think increased monopoly power of some companies and then using that monopoly power to reward. Their c. E. O. s in an excessive why. Mispriced i mean even before issue that we poor this is something that has galvanized a tense of a quite some time member of friends economist Thomas Piketty said in his book that a long as the. Rates of return in capital is bigger than the growth you will continue to have the same problem basically which is a tiny minority and it up with loads of cash a billion of people suffering. Well im afraid thats probably the case but i think its worth looking at what is going on in a number of economists the reality is that a lot of the money has not been used for public spending more generally to improve infrastructure Health Education for people particularly for women in a number of areas the oxer report highlights that so its not just a case of perhaps wealth being constrained to even if you hands because of capitalism and so on the way that its been developed that Thomas Piketty is spoken about it is also that policies within individual countries have just not done the right thing and thats where the focus needs to be of course we need to do something about having greater access to the money and everyone in fact paying a fair tax but you need a real restructuring of the way in which government is run and also the way in which Companies Operate in those countries themselves are treating their own workers Corporate Social Responsibility or something every were talking about until recently seems to be slightly forgotten but some of the accommodations in the oxfam report are that this should be huge amount of spending done by the Public Sector one should watch what happens and what you subcontract to the private sector things that we also see of course in the developed world being an issue. But generally does require an awful lot of money to be directed the right way so Technical Support but also frowning upon the way in which some of the the leaders of various countries operate more controls of what happens to the money that should be legitimately staying in the country a lot of corruption is there that is not some were talking about that a an organization off from can going to sara lee solve you know overnight took about a Healthy International corporation basically a neros i see him now you on the other hand you have conservative economists saying that the only way out of this inequality is basically tax cuts and government derogation instead of imposing taxes all the old wealth. Well i i dont i dont think so i think that there needs to be some sort of Business Environment where people can invest so some sort of tax incentives are good but i think reducing really like the Corporate Tax and also the income tax so much and then dont not have in for example taxes on Capital Gains or on dividends is not the way to go and as the oxfam kind of report showed. If there is only one point five like percent taxes on billionaires there will probably like be we did occasional problem that exists in in developing countries so so i think that there needs to be like a fair system of taxation in the sense that its not a lot of pressure on the business but at the same time when i think we need to generate a lot of a lot of income and resources you know when there are for example like pressures from International Organization a lot of the african countries but also south Asian Countries and latin american countries in order to balance the budgets also to have like some sort of micro cannot make sound thats what i really like gets kind of sacrificed are the spending on education and spending and all of that and i think those kinds of you cannot have that you cannot have like reduction in terms of spending and at the same time im going to have reductions in taxes i think thats something that is probably like mathematically impossible therefore i think some sort of tax system which does not give tax breaks for the rich a lot of the rich although they may get like tax breaks i mean some of that money is not reinvested in the economy as the conservatives theorists like us say bustle a great how can we juggle the need to implement those reforms at the same time take into account a new changing dynamic in the Wealth Technology for example has been taking away jobs from the middle middle class how can you address this issue ation with the world is moving fast towards a new territory. Youre absolutely right to say that technology has been taking away some jobs its also been creating new ones the. Road to success is to try and accelerate the benefits that we get from technology while ensuring those benefits are widely shared and while equipping workers with the skills to acquire the new jobs that are being created and indeed to continue changing jobs over time i think looking at the poorest half who are the focus of the robots population who are the focus of the oxfam report i think theres lots that can be done at a National Level in terms of raising minimum wages and ensuring that the labor regulations are properly enforced theres lots that could be done in terms of ensuring that taxes are raised more efficiently that they actually are progressive very often in developing countries and they hit the poor hardest and the rich not at all they focus on wealth and not just on incomes and in particular on Wealth Account move so for example property which is easier to tax than more flighty forms of wealth and that there must be a government that genuinely works to improve the Living Conditions of everyone not a government that is captured by cronies of of the ruling class and cosseted businesses so you have the model is the development of a country such as south korea which invested very quickly in education for all in infrastructure and ensuring a Competition Among firms not oligopolies than to exploit the population mispriced i mean the moment you talk about how to move forward then you have two options people would tell you countries that provide more equal. Of income like scandinavia for example could be a role model other same time you get the same reaction from people in the us to you thats class warfare we should not allow for any system similar to the one to prevent i mean how can we balance the two approaches one which is in favor for a more private sector to be aggressive and one which says no we need to have the the public and the private sector come together to solve this issue. I think the goblets sector the private sector have to Work Together theres no doubt about that but if you compare countries which have quality quality with the state sector works is quite large and works quite well perhaps with the private sector and you look at others where this isnt the case and you have a more Unequal Society there isnt any direct link that tells you that one grows less fast in the other certainly if you look at the short to medium term but if you keep those inequalities going for a long period of time what you get is huge disruption and dissatisfaction in the country and therefore you get fewer people wanting to invest and lower growth so there are long term negative impacts of having that inequality remain and what is more you then get people moving out of the country perhaps particularly those who can afford to go elsewhere and you rob the talent from the countries the reason behind with less productivity and less growth but also then you have century the problem for the rest because of huge migration flows that were seeing right now so afraid what misshapen is that sort of two prong things first of all to see whether there is some money that can be transferred either by taxing perhaps some of the very wealthy but also the western countries paying more into the developing world and theyve done so far so its not just relief and and and support for famines and so on but actual proper Economic Development money going in but working very closely with the government so that would be the the first way of doing it and the other thing is to possibly think of the times assumptions that that can can be used against countries that dont follow that principle because in reality if they can carry on trading just as it is before despite the fact population is suffering actually in elation to just a few people at the center or the top then you you dont actually get anywhere so there has to be a system that is working across in terms of trade rules for taxation whether we. Except any goods or even oil from countries which actually dont do the right thing so its it is it is something that does as i said earlier require quite a lot of working across but with International Going to is ations which are very important like the i. M. F. The world bank which are there as well and work quite closely with some of that is because the system that works through missa has had that iraq a country that faces financial constraints basically theres been always this debate about the need to impose higher minimum wage greater access to education for. To shrink the wealth gap is something that is visible. I let me just speak to the question of International Development i think what is happening right now if you look at the International Development seems that about like fourteen billion dollars that is spent by rich countries on poor countries but at the same time with a lot of the investments and globalization and a lot of the big kind of businesses in the global south they reap out Something Like six trillion dollars in terms of tax breaks in terms of profits in terms also of cheap labor and all of that so its a very unequal kind of situation in terms of International Development i mean i think it can work but i mean not really like that that was so i think what what needs to happen is to have like a fair kind of system Financial System which now like profits more i mean like the global north its its very advantages to a lot of the businesses but also to the lot of the wealthy people in the globe but i mean like talking about what needs to be done i think one of the things that that needs to be done is actually cash conditional cash transfers to the poor thats something that needs to be done it needs to be conditional but it needs also to be a come by that but some sort of skill training for a lot of the poor and i think has worked in a lot of countries the other thing is like a lot of people have moved from poverty and then they are now in the middle class but they are very vulnerable because they are close to poverty they can fall back any kind of time so strengthen in those three to cation through incentives through different kinds of support so that they can stay in the middle class but also have the right skills in order to function is something that needs to be done but i mean like for a lot of countries including morocco but also in the global south generally when needs to happen is to move away from the client list kind of system where there are Revolving Doors between the businesses and the political elite thats one of the problems a lot of the Business People are also part of the political elite a lot of the politicians become businessmen and there are all kinds of like passed through us that happen and this is and i think in there needs to be an oversight on all. So very very good system of transparency and accountability because of the over sides of this particular angle mr howard that this is going to be my question to mr grant i mean were talking about the need to reform the Financial System in its own by the same time people are saying that what needs to be done first of all is to ensure that the one percent elite that cumulate swell. Stops using the political establishment to further advance its own economic agenda how can you demand it yes well i mean i think financial reform has to be right at the top of the global agenda you know its amazing weve had the worst financial crisis since the one nine hundred thirty s. And theres been a bit of tinkering around the edges but basically the system is intact and now with the election of President Trump theres talk of the United States going backwards on some of the regulations have been put into place and i think thats a very big difference between the global businesses which are being attacked often in this oxfam report which perhaps could behave better but at the same time are creating products that people genuinely want and employing people doing valuable things and a Financial Sector which sometimes does productive things like helping to finance companies but on the other hand often does engages in destabilizing speculation blows up of walls causes crises and in riches the participants in that system not necessarily the investors and then when things go wrong use their links to governments to get bailed out and you know i think thats the deep cause of the political troubles that were seeing in europe and north america the sense of injustice is completely understandable and right and very very little has been done of it and i think it has to be a focus for reform really crossing the Financial Sector down to size ensuring it serves the needs of the real economy rather than its own and ensuring that when things go wrong the people in the Financial Sector bad the losses rather than being inflated on society as a whole has to be an absolutely top priority mr price i mean in this particular part of the world were talking about an area be set by wars conflicts instability massive destruction and you talk about the need for hundreds of billions of dollars in the near future to be able to address the situation is this something which is the instability that is modeling the region that. It was a situation of this gap that were talking about im afraid so so conflicts dont help at all and of course they create quite a lot of uncertainty but of course weve seen the humanitarian costs that are there rebuilding it afterwards takes a long time and it has already done terrible things to the fabric of society so getting back to something more sensible takes time so any were a way that one can avoid those conflicts to begin with it is easier said than done of course but also being absolutely prepared to help with the reconstruction afterwards is also significant to allow there for the cooperation between businesses and and government to come back so that there is some certainty when Companies Invest and i understand exactly what what weve just been talking about which is the Financial Sector in sometimes not being very helpful but we do think the funding there is just no doubt about it that somehow or other one requires to make transfers of funds maybe marshall Financial Plan like we had after the air marshal plan of sorts so the size of the Marshall Plan funds which we needed in europe we actually need to know a lot in various places in the developing world particularly in areas of conflict and this migration that i mentioned here nice to be tackled that way too but i think just once short point about corruption i think that is something question if can when oxfam talks about. Taxing the money and making sure he gets this is going to that we often dont actually know where that money is that always in who is it is afraid ill just have to get one last question to mr the less than a minute please when you see the leader of the United States of america saying theres absolutely no way we can give money to the rest of the world unless they are on board or with us are you concerned that the idea of corporations in the rich helping the poor might come to an end why i think is also like a question of leadership and i think the country like United States should go on leading in terms of International Development but also in supporting all the kinds of u. N. Agencies but there are also other actors on the ground that are doing like tabulates work in terms of Poverty Reduction so i think its not its in the interest of the United States was also its interests of the leadership but i mean should happen i think there are other kinds of players that will come in i mean like china is ready to move in as the leader i mean it has the money it has also the power to do that for you also go let me can you just go back everybody to the question of the middle east i mean like the you have very briefly d. N. A. Quality in the me just this is also one of the factors that led to the revolutions whether its in so many of those kinds of can thank you so the inequality leads to revolution most of the revolutions actually dont dont dont create a quotient we were running out of time less and had that. Vicky pryce and phillip low ground thank you very much indeed for your time your contribution to the program and thank you for watching you can see the program again any time by visiting a website dot com for further discussion go to our Facebook Page thats facebook dot com for slash a. J. Inside story you can also join the conversation on twitter a j inside story from me hashem the whole team here by phone now. Rio has big plans to turn its largest favelas into spectacles. But inside the favelas. Big plans of his own. Building since the age of twelve untrained yet skilled architect has as good a chance as any at seeing his vision come to light. The bedroom and the master plan and the concluding part of rebel architecture at this time on aljazeera. We understand the differences and the similarities of cultures across the world. So no matter where you call home aljazeera will bring in the news and Current Affairs that matter to you. 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