1% of Chinese Own One-Third of the Wealth

About one percent of Chinese households own one-third of the nation’s wealth, raising concerns about income inequality in the world’s most populous country, according to a study by Peking University.
Chinese households on average had a net worth of 439,000 yuan (about $71,000) in 2012, up 17 percent from the 2010 level, the university’s Institute of Social Science Survey said Friday in its latest report on China’s livelihood development.
However, income inequality rose rapidly during the period, the report said, as the top one percent of Chinese households held more than one-third of the nation’s wealth, while 25 percent of households at the bottom owned only 10 percent of the country’s property value.
The researchers based their main analysis on 2012 data from the China Family Panel Studies, a large-scale survey project conducted by the institute.
The report showed about 74.7 percent of Chinese household wealth came from owning real estate.

Inequality in China

Elizabeth Warren on the Hustings for 2014 Elections

Make no mistake.  Elizabeth Warren is a middle of the road progressive.  Her central mantra is clear and uncontroversial:  if you work hard and play by the rules you should be able to succeed.  Given the PIketty formula,  r>g, it is unlikely that this can happen.  Warren wants to make sure America returns to its origins as a land of opportunity. Here she is in a recent article.  Reining in Big Banks

Warren

Zephyr Teachout, Anti-Corruption Expert, Runs for Governor of New York

We interviewed Teachout over two years ago  and her article on the idea of corruption in the US constitution is available on the site. The Anti-Corruption Principle.

Teachout originally supported Governor Cuomo, but has been deeply disappointed.  While it is unlikely that she can win, she casts light on issues important to many Americans.  Elizabeth Warren may serve this function too.  Or perhaps she will play a bigger role in 2016.  Both women are extremely concerned with banks that are too big to fail.  Teachout for Governor of New York

Corruption

Family Friendly Corporate Policy

Women partners at the prestigious US law firm Skadden Arps are sent out to talk to the young female associates about their future. The word nanny is mentioned even before baby is.

A succesful tech company in Eugene, Oregon has taken a different path. Gwen Moran writes: Palo Alto Software, a company that develops business planning and other business-focused software, every day is Take Our Daughters and Sons to Work Day. CEO Sabrina Parsons, who has led the company since 2007, is a staunch advocate of family-friendly policies and is trying to help her employees and others in the tech sector deal with the fact that people have babies. Taking care of them shouldn’t derail your career.

Parsons says that the juggling work and parenting is tough for all parents, but the physical and societal demands placed on women hold particular challenges. From getting pregnant and giving birth to the disparity in many caregiving situations, she says parenting puts women’s careers at risk more than men’s.

“You’re in the prime of your career with all of this experience, when you get mommy-tracked. They get ‘concerned’ that you can’t do your job. That’s a huge reason why we’re not seeing women in leadership roles across Fortune 500 and Fortune 1000 companies and in politics,” she says.

So, Parsons–the mother of three boys ages 10, 7, and 4–is trying to show them how it’s done. At her 55-person tech firm, which was founded by her father, employees enjoy family-friendly policies including flex time and an environment that welcomes children. Parsons herself brought her children to work after they were born, and wore them on a sling around her neck until they were four months old, allowing her to practice attachment parenting while being the CEO of the company, she says.

Kids have comfy couches, crayons, and “there’s always a spare iPad or laptop around,” she says. The company also offers employee health club memberships, which include children’s programs on some days, so parents can take a break by bringing their children to the gym or taking them to lunch, she says.

Palo Alto’s kid-friendly policies aren’t a substitution for day care and there are limits. You can’t bring your kids to work every day, but if they have a week off of school or a particular day when your child care situation has hit a bump in the road, the policies give you options, Parsons says. Children need to sit quietly with their parents–no running and screaming in the halls allowed. And colicky babies aren’t welcome because they’re too disruptive.

While still a small firm, Parsons says that her policies have had real bottom-line benefits. First, Palo Alto enjoys a loyal workforce with little turnover, she says. Fully one-third of her development team is women versus Silicon Valley’s average of 7%.

Revenue from the company’s flagship product has grown 106% over the past 12 months, which she attributes to the contributions of loyal, happy employees. That includes the four working fathers who take advantage of the kid-friendly policies on a regular basis, she says. But there is still more work to do to get all working parents feeling supported and able to pursue their careers without having to sacrifice their roles as parents, she says.

“We need more women in a position to say that we are going to have these types of policies. It’s just assumed that it’s unprofessional. Why is it unprofessional? We need to find a way to make work and family work for everyone,” she says.

The Immeasurable Advantages of Being Rich

Lawrence Summers, Presidential Advisor, Harvard professor and President, remarks that it is not the the middle and lower classes resent what the wealthy have, but that they want more themselves.  How can this be achieved as we address the issue of inequaility.

Summers suggests that two important aspects of income inequality will not be effected by income redistribution: health care and education.

“Barry Bosworth and his colleagues at the Brookings Institution have examined changes in life expectancy starting at age 55 for the cohort of people born in 1920 and the cohort born in 1940. They found that the richest men gained roughly six years in life expectancy, middle-income earners gained roughly four years, and those in the lowest part of the distribution gained two years. To put this in perspective, the elimination or doubling of cancer mortality would mean less than a four-year change in life expectancy.”

Children of the affluent go to college more than others in part because they have 6000 hours of extra curricular activities that enhance their education.

In addressing the issues of inequality, Summers suggest that focus should be placed on the health and education of the lower 99% as well as the taxation of the 1%.

Education

 

Chipotle Executive Pay Under Attack

A small group of nuns who held shares of JP Morgan Chase brought Jamie Dimon to his knees.  Now the CtW investment group, which oversees $250 billion dollars in union pensions funds, has gotten the shareholders in Chipotleto vote down excessive executive packages.  While the vote at the annual shareholders meeting is not binding, the company board has said that they will take the vote seriously.

Chipotle

New York Times Chief Fired Because…

We will never know exactly why Jill Abramson, the first woman to lead the New York Times editorially, left the company abruptly.  Some say fights in the newsroom.  Others, that she was disgruntled at being paid less than men in the same job.

What we do know is that the Times was having a difficult time transitioning to the digital age.  In the worst of times women are brought in to lead companies.  Mary Barra at General Motors.  Carly Fiorina and Meg Whitman at Hewlett Packard.

The flack over the dismissal would be far more shrill if a male editor of color had not been logically available to take over.  Who else but a person of color or a woman wanted to President of the US when the US, as Timothy Geithner has recently pointed out, was a flaming plane trying to land?

Women Executives

 

 

Elizabeth Warren: A Fighting Chance

Is this a platform for a Presidential campaign, public policy or both?

Elizabeth Warren’s new book advocates for the disappearing middle class in America.

An unlikely political star tells the inspiring story of the two-decade journey that taught her how Washington really works–and really doesn’t As a child in small-town Oklahoma, Elizabeth Warren yearned to go to college and then become an elementary school teacher–an ambitious goal, given her family’s modest means. Early marriage and motherhood seemed to put even that dream out of reach, but fifteen years later she was a distinguished law professor with a deep understanding of why people go bankrupt. Then came the phone call that changed her life: could she come to Washington DC to help advise Congress on rewriting the bankruptcy laws? Thus began an impolite education into the bare-knuckled, often dysfunctional ways of Washington. She fought for better bankruptcy laws for ten years and lost. She tried to hold the federal government accountable during the financial crisis but became a target of the big banks. She came up with the idea for a new agency designed to protect consumers from predatory bankers and was denied the opportunity to run it. Finally, at age 62, she decided to run for elective office and won the most competitive–and watched–Senate race in the country. In this passionate, funny, rabble-rousing book, Warren shows why she has chosen to fight tooth and nail for the middle class–and why she has become a hero to all those who believe that America’s government can and must do better for working families.

Elizabeth Warren

Did Austerity Succeed in Great Britain?

Chancellor George Osborne tells IMF meeting in Washington, resoundingly yes. Critics of Britain’s economic recovery plan have been proved “comprehensively wrong”, George Osborne has said.

The Chancellor conceded “many risks remain” for the UK, including the fall out from the crisis in Ukraine and the sluggish eurozone recovery.  Mr Osborne was in Washington for the spring meetings of the IMF and World Bank, basking in the latest IMF forecasts which predict the UK will be the fastest-growing economy among the major developed nations this year.

Osborne said: “Pessimistic predictions that fiscal consolidation was incompatible with economic recovery have been proved comprehensively wrong by events.

“Cutting deficits and controlling spending has not choked off recovery but has instead laid the foundations for sustainable growth.  Many risks remain, but all this should be cause for cautious optimism. The pessimists said our plan would not deliver economic growth. Now they say economic growth will not deliver higher living standards. They were wrong about the past and they are now wrong about the future. It’s only by continuing to work through our long-term economic plan that we can deliver more economic security and a brighter future for all.  If we can control our public finances, strengthen our financial systems and set free the power of human enterprise and innovation then there is no reason why our best days should not be ahead, for all of us.”

He used the keynote speech to reject the arguments of the IMF’s chief economist, Olivier Blanchard, who warned last year that the UK’s austerity policies were strangling growth, saying such an approach was “precisely the wrong prescription for our economies”.

The Chancellor said that the strengthening economy in Britain is underpinned by well-capitalised banks and a “credible” fiscal policy.

He argued that the UK’s experience has shown that claims that recovery required more fiscal stimulus and higher government borrowing were wrong, and that re-building the public finances goes hand-in-hand with restoring the wider economy.

Mr Osborne pointed to figures showing that job creation is three times faster than in any previous UK recovery – with four new jobs in the private sector for every one lost in the public sector – while the rate of growth in investment spending is outstripping the United States.

“Our economy has grown faster than any other in the G7 over the last year and is now forecast by the IMF to do the same in 2014. This is despite warnings from some that our determined pursuit of our economic plan made that impossible.

“All of this demonstrates that fiscal consolidation and economic recovery go together, and undermines the pessimistic prognosis that only further fiscal stimulus can drive sustainable growth. Indeed, that is precisely the wrong prescription for our economies.

“Instead of more debt or more government spending, we need to get our public finances in order, make structural reforms and compete in the world again.”

The Chancellor also singled out Cabinet colleague Michael Gove for praise for his controversial radical education reforms, insisting that they would help bolster Britain’s economic recovery.

“T here is one area of reform that I believe is more important for our long-term prosperity than all the rest – that can deliver growth rather than stagnation and simultaneously ensure that the gains from growth are shared, and t hat is education.”

He added: ” What unites all of these reforms is a belief that our nation will only make progress if we make use of every child’s talents and liberate every student’s potential. In all these ways we can ensure that the link between growth and prosperity remains unbroken.”

Successful Belt Tightening

 

Impact of Lobbying

Andreas Frank reports:   The enormous power and destructive influence of financial markets became apparent after the global economic collapse of 2008.

This event revealed a need for bringing the sector under democratic public ownership; failing that, stronger regulations for financial markets at the very least. But political will has been lacking on both counts. The sector enjoys massive financial resources and successfully translates them into political influence.

The EU’s financial industry spends more than €120 million per year and employs over 1,700 lobbyists to work in the EU institutions, according to new research by transparency campaigners.   Financial Lobby Power

Financial Lobby