Friday, February 23, 2018

Inequality is the norm

The OECD researchers rate as “income poor” any households that are making less than half what their nation’s most typical households make. “Asset poor” households don’t have enough cash on hand to maintain themselves above this “standard poverty line if their incomes stopped for three months.”
These two categories do certainly often overlap. Across the developed world, the new OECD stats show, 11 percent of people rate as both income and asset poor.
But the two categories frequently don’t overlap. Many millions of households across the developed world have above-poverty incomes but qualify as “asset poor.”
A whopping 36 percent of people across the developed world, the new OECD research notes, find themselves in this situation. They rate as “economically vulnerable.” If their above-poverty-line incomes should stop for three months, they’ll sink into poverty.
In other words, on average across the developed world as a whole, over a tenth of the population is already living in poverty and over another third is living at the economic razor edge, at danger of falling into poverty at any moment.
 “Economic vulnerability,” the new OECD research shows, varies widely within the developed world. Only a little over 10 percent of people in Japan, for instance, rate as economically vulnerable. Just about 40 percent of Americans, by contrast, live at that razor’s edge. What do nations with high levels of economic vulnerability seem to share? In high-vulnerability nations, wealth tends to concentrate at the economic summit. In the United States, the OECD notes, the top 1 percent hold 42.48 percent of the nation’s wealth. In low-vulnerability nations, the rich typically stamp a smaller footprint. In Japan, the top 1 percent holds only 10.77 percent of national wealth.

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