Is Income Inequality Leading To A Crisis For Capitalism?

Discussion in 'Economy' started by kiwiman127, Feb 16, 2012.

  1. kiwiman127
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    kiwiman127 Comfortably Moderate Supporting Member

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    Capitalism Seen in Crisis by Investors Citing Inequalities

    International investors say capitalism is in crisis, with almost one in three backing radical changes to the system, according to a Bloomberg survey.

    As the global financial and business elite gather in Davos for their annual forum, a majority in the Bloomberg Global Poll agree that income inequality hurts the economy and that governments need to do something to address it -- ideas at the heart of “Occupy” protests worldwide. Those surveyed also voice reservations about the financial industry’s role in society, with seven in 10 seeing at least some truth in the argument that banks have too much power over governments.

    “Capitalism is in crisis because there is a huge and growing disparity in income/wealth distribution in Western economies, and an equally divisive generational disparity,” poll participant Michael Derks, chief strategist for FXPro Financial Services broker in London, said in an e-mail.


    <snip>

    "There is a large and growing wealth disparity and I think it is unhealthy,” Steve Morton, a director at Natixis Securities in New York who took part in the survey, said in an e-mail. “The lower levels of the pyramid don’t have enough money to buy things and keep the economy going.”

    <snip>

    The banking culture has evolved radically, to the point where the perception amongst most members of society is that their actions are driven by the relentless pursuit of earnings with no regard to their potential negative impact on communities,” said Anson Rosewall, a poll participant and sales trader at BBY Ltd., a financial services firm in Sydney, Australia.

    “The fact that banks have taken government cash, while the average person has lost his job and house without help, will probably forever tarnish the reputation of these major institutions,” he said in an e-mail.

    The gap between rich and poor is widening across most developed economies as executives, bankers and skilled workers reap more rewards, the Organization for Economic Cooperation and Development said last month.


    <snip>

    The 459 U.S. investors who answered the survey view capitalism more favorably than their counterparts elsewhere, with roughly one in five saying the system needs an overhaul, according to the poll.
    Capitalism Seen in Crisis by Investors Citing Inequalities - Bloomberg

    The US investors have a more rosey outlook, maybe because Chart 1 leads to Chart 2?

    Discuss.
     
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  2. TakeAStepBack
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    TakeAStepBack Gold Member

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    We'd first need to have capitalism for it to be in crisis from income inequality. It seems the elite realize that their corporatism is causing a crisis and now want the gubmints to "do something about it".

    They should, too. only certainly not what their corp. leaders want them to do. They should GTFO out of business altogether, restore a sane monetary policy and allow for free markets.
     
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  3. PoliticalChic
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    PoliticalChic Platinum Member

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    The idea that capitalism is in crisis, or failing in some way, is short sighted. It serves only to reinforce the mistaken Leftist view of the rectitude of totalitarian central planning.

    I don't know if you read books, but the latest Charles Murray tome, "Coming Apart," might give you insight into the larger picture.
    He discusses four elements that have historically defined American society which he calls the four founding virtues:
    industriousness, honesty, marriage, and religiosity.

    Any economic inequality can be laid directly to the first of the four rather than any crisis in capitalism.
     
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  4. Uncensored2008
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    Uncensored2008 Libertarian Radical Supporting Member

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    Oh goody, another "Communism is the only answer" thread...
     
  5. kiwiman127
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    kiwiman127 Comfortably Moderate Supporting Member

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    So, the world's elite investors are saying that income inequality is hurting capitalism and they are communist lefties driving their ideology? These people live off of capitalism and capitalism is driven by consumer spending.

    As noted in the article, ""There is a large and growing wealth disparity and I think it is unhealthy,&#8221; Steve Morton, a director at Natixis Securities in New York who took part in the survey, said in an e-mail. &#8220;The lower levels of the pyramid don&#8217;t have enough money to buy things and keep the economy going.&#8221;

    Around 70% of the US economy is driven by consumer spending, yet the base of the consumer class doesn't have the expendable income to "keep the economy going". And it's good to keep the status quo and continue to watch our own country's economy flounder? Seems to most folks that the status quo isn't good for the US broad economy.

    So, Corporate America is seeing excellent profits and the profits are making the uber wealthy wealthier and while this is going on wages for the working class remain dormant and this is good? How is this good for the US's economy long-term in a consumer driven economy? Who determines the working class's wages?

    Some people are completely missing the point. A majority of the world's top investors "get it", what do they know anyway, right?
     
  6. Truthmatters
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    Truthmatters BANNED

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    the right on this site are insane.

    they will accept no facts that dont feed into their ideology.

    They are a failing flailing party
     
  7. TakeAStepBack
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    TakeAStepBack Gold Member

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    They know how to hoodwink the less informed into believing that what is taking place in America, and in many industrial countries around the world, is capitalism. It isn't. I agree that there is a created wealth gap that is killing the "middle class" (cringe, i fucking hate class warfare rhetoric), but it has more to do with government and big business collusion and economic totalitarian planners, than anything else.

    I'd love to see a return to capitalism.
     
  8. PoliticalChic
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    PoliticalChic Platinum Member

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    Thank you, Sam Webb.
     
  9. uscitizen
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    uscitizen Senior Member

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    On a different note this is also about Global income disparity.
    Chinese work cheaper so we have less jobs/money.
     
  10. TakeAStepBack
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    TakeAStepBack Gold Member

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    Thanks, added to my ever growing list of "to read".
     

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