Bloomberg Businesweek has a gem of an opener. It’s about income inequality, and, you guessed it, it’s completely off the mark.
Here’s the opening shot:
“On Feb. 29 the World Bank announced that the proportion of the planet’s population living in absolute poverty—on less than $1.25 a day—had halved from 1990 to 2010. That rate of poverty reduction is unprecedented, driven by rapid rates of economic growth in poor countries from China to Ghana.”
Wow! That’s awesome. Unprecedented poverty reduction. Halving the poverty rate across the planet in the course of 20 years. Wow! That’s awesome.
But, no! Not to the hacks at Businessweek. Here’s the remainder of the paragraph and essentially the next two pages of the article:
“Yet despite the huge progress against poverty worldwide, inequality—the gap between rich and poor within countries—has been expanding. Recent analysis by economists Isabel Ortiz and Matthew Cummins at Unicef suggests about two-thirds of all countries have become more unequal over the past two decades.”
So what!?!?!? So what if the gap is expanding. The poor are getting richer and the rich are getting richer. This is a good thing! The gap doesn’t matter!
There are lots of reasons why the rich get richer faster than the poor. One of those reasons is pure mathematics:
3% (say, in interest, or return on investment) of $100 is $3
3% of $1M is $30,000. So yeah, bank accounts that are big will get bigger faster. This is just pure math – nothing unfair or unequal or having to do with education levels or having to do with ANYTHING OTHER THAN MATH!
Come on Businessweek, figure it out. The gap doesn’t matter.