Belfast Telegraph

Saturday 1 November 2014

How rich man, poor man beggars belief... while a minority elite cashes in

It's been another funny old week for all things economic, with a veritable cast of thousands putting their penny's worth in: a story of hard times set against the hallowed sanctum of the House of Commons, the mean streets of Belfast and the snow-capped cantons of Switzerland.

As David Cameron argued that the recovery was well on its way, Ed Miliband was spouting on about the cost of living crisis still biting, leaving each of us £1,600 a year worse off. So who is right?

It depends. Pay packets have actually gone up £1,352 a year since May 2010, but then inflation has remorsefully eaten into that and many are actually working a longer week for the same money as five years ago, while others await with dread the welfare reforms.

There may well be an 'up-turn', but the crumbs from the tables of our masters have yet to fall down to the man or woman in the street. The man or woman who, as the first Civic Forum on Poverty, held in Belfast this week heard, is having to 'rob Peter to pay Paul' while others are jailed because of a 'failure' to pay bills.

The message from the forum was frightening: Northern Ireland is still at crisis point with families on the breadline and urgent action must be taken if it is to be tackled effectively. The outlook for many is not good, right up to 2020.

And speaking of our masters, the World Economic Forum (WEF) meeting in the five-star comforts of Davos in Switzerland was told how the rich are getting richer and the poor – well suffice to say that the richest people in the world, who collectively have more wealth than literally half the population, 3.5 billion of us, could comfortable fit into a double-decker Transit bus. Global inequality has increased to the extent that the £1trn combined wealth of the 85 richest is equal to that of the poorest 3.5 billion.

The report from Oxfam, entitled Working For The Few, claims growing inequality has been driven by a 'power grab' by wealthy elites, who have "co-opted the political process to rig the rules of the economic system in their favour''.

Falling taxes for the rich and an increased use of tax havens have helped widen income inequality, Oxfam said.

Without even a hint of irony, the development agency called on the forum attendees to take a personal pledge to tackle the problem by "refraining from dodging taxes or using their wealth to seek political favours''.

Oxfam chief executive Winnie Byanyima said: "We cannot hope to win the fight against poverty without tackling inequality. Widening inequality is creating a vicious circle, where wealth and power are increasingly concentrated in the hands of a few, leaving the rest of us to fight over crumbs from the top table.''

The world's richest (£40bn) man, Bill Gates, countered all by saying that extreme poverty and child mortality would be virtually eliminated in the next two decades. If only I had the luxury to afford to believe him when he says: "The belief that the world is getting worse, that we can't solve extreme poverty and disease, is just mistaken.''

Cue the Pope, with some words of advice to the faithful flapping in Davos: use the billions to serve the world, not rule it. Fair play, Francie lad, but you did not use the opportunity to roundly condemn the greed and excess that has oft characterised the meetings of the WEF.

Meantime, as weasel words poured forth from all and sundry, came the news of Asia, in particular Thailand, reneging on a £2.4bn debt and Singapore about to come unstuck, while the Washington Post reported that house prices in 17 countries – including, aha, snowcapped Switzerland, Australia, Canada, France, Germany and metropolitan London, UK – are about to go ape and we all know what happened the last time Fannie Mae and what's-it ran amok. A butterfly flaps its wings in Borneo and all that.

And so we cannot afford to be complacent. But what strikes me is that many economic academics, as far back as the 1970s, and more recently last year's Nobel prizewinner Robert Shiller, have been supplying the world with a blueprint for a way forward.

American Shiller's argument is simple enough: we need to "reframe the wording of 'universal human rights' so that they represent the rights of all people to a fair compromise – to financial arrangements that share burdens and benefits effectively''.

More pertinently though, if our masters at Stormont, Downing Street, the EC, WEF et al are unaware of such a stark and simple message on the big global issues, or glaringly fail to act on such, then, quite frankly, it begs a question about those who purport to lead us.

Are they suitably fit for office?

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