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Wealth, poverty, and progressive taxation April 4, 2009

Posted by dorigo in news, politics.
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A note left by a colleague in his facebook page:

I just can’t get these numbers out of my head: The 500 richest people on earth earn more than the bottom 416 million.

That’s 416 million – not 416 thousand, or 4.16 million, but 416,000,000 – much more than the entire population of the United States.

So if some ideologue decided to even out wealth distribution between these two extremes, each of those top 500 earners would see their net worth reduced by a factor of a million! They would lose 99.9999% of their wealth, while the bottom 416 million people would see their assets double.

I’m used to large and small numbers, from my work, but this amazes me. The numbers come from an opinion by Nicholas D. Kristof published in the International Hearald Tribune yesterday, 3-April-2009, and he cites the U.N.

And my reaction:

Hi M., that is indeed striking -and disgusting, in a way. I would not ask the 500 richest people to share all their wealth. If they just gave away half of what they have, 416 million people would still get a 50% increase of their means. That would be a little bit less ideologic and maybe only decent!
Probably the only way about this is not to intervene in a rotten situation, but change the rules. Progressive taxation is the way. The economic situation in the world lends itself to strong intervention, and I think what they G20 decided this week is a step in the right direction, but still a bit too shy.