Russia’s poor are in worst condition than 1990’s while the rich double thier wealth

Published in the Guardian

rish russian women shopping
The richest slice of Russian society has doubled its wealth in the past 20 years, while almost two-thirds of the population is no better off and the poor are barely half as wealthy as they were when the Soviet Union fell, according to researchers.

Experts at Moscow’s Higher School of Economics (HSE) found that the purchasing power of the average Russian has grown by 45% since the early 1990s, but income disparity is widening by the year. The report reinforces a widely held view that oligarchs got rich quick by snapping up the country’s choicest assets in the turbulent post-Soviet period.

Yevgeny Yasin, scientific director of HSE and a former economics minister, said: “The principal issue for Russia‘s economy and society today is the level of inequality. Only the best-off 20% of the population is successfully participating in the rise in prosperity which became possible as the result of creating a market economy.”

Food is slightly cheaper relative to income and simple pleasures have become more accessible. The average adult buys more vehicles and televisions and can afford more alcohol and cigarettes than at the beginning of the 1990s. “Drinking, smoking and burning around in a car have become a lot cheaper,” the report found.

But most Russians can only stare in envy at the super-wealthy with their Bentleys and dachas. According to the report, income inequality between the mid-1980s and the mid-2000s has increased eight times more than in Hungary, and five times more than in the Czech Republic. The huge gap between rich and poor “largely negates the economic and social achievements of recent years,” the HSE report said.

Yasin added that the study indicated there were “two Russias”. The wealthiest fifth of the population received a pay cheque equivalent to 198% of its value in 1991, while the poorest fifth made only 55% in real terms. In total, 60% of the population has the same real income or less than the average 20 years ago.  “Many things are required to change this,” said Vladimir Gimpelson, one of the authors.

“We need more political and market competition, enforcement of property rights, rule of law, systemic change in labour market institutions and stronger social protection for the needy.”  The widening gulf comes as the World Bank recorded an overall drop in poverty. A report by the bank published on Sunday found the percentage of people in Russia living below the poverty line – meaning those who earn less than 5,900 roubles (£130) per month – fell from 13.2% in 2009 to 12.7% last year. It attributed the fall to increased pensions, public sector wages and benefits for job seekers, and predicted that continuing economic growth would push the figure down to 11.2% this year and 10% next year.

However, the report repeated a past admonition that Russia must diversify its economy to reduce its reliance on oil and gas exports. Two prominent Russians much richer today than they were 20 years ago have published income declarations, showing their earnings dropped between 2009 and 2010. Prime minister Vladimir Putin declared £104,000, compared with President Dmitry Medvedev’s £70,000.

Advertisements

Libyan revolutionary council rejects African Union’s peace initiative

Published in the Guardian.

Mustafa Abdul Jalil

Libya’s revolutionary leadership has flatly rejected an African Union peace initiative because it does not require Muammar Gaddafi to immediately relinquish power.  The rebels’ interim ruling council met an AU delegation from five countries – led by three presidents and two foreign ministers – the day after Gaddafi endorsed the African “roadmap to peace”, which included an immediate ceasefire, the suspension of Nato air strikes and talks towards a political settlement.

But Mustafa Abdul Jalil, the revolutionary council chairman, said the rebels had told the AU its proposal had been outdated by events, including the UN security council resolution authorising air strikes, and was in any case unacceptable because it left Gaddafi in power while both sides negotiated.

From the very beginning we have been asking that the exit of Gaddafi and his sons take place immediately. We cannot consider this or any future proposal that does not include this peoples’ requirement,” said Jalil. “He leaves on his own or the march of the people will be at his doorstep.”

That view was strongly backed by thousands of demonstrators outside the Benghazi hotel where the talks were held. They waved revolutionary flags and carried signs saying: “No solution with Gaddafi staying”. Jalil said that the AU peace proposal was drafted a month ago and had been overtaken by the UN security council resolution requiring Gaddafi to halt his attacks on civilians. “Colonel Gaddafi did not recognise this resolution and continued bombing civilians from the air and shooting them, and surrounding cities with his forces and put his forces inside cities. There is not any way the Libyan people can accept such a situation,” he said.

Although the AU proposal included a ceasefire, the rebels said it did not go far enough. They want one that requires Gaddafi to withdraw his forces from towns where they have been used to suppress the revolution, particularly Misrata and Zawiya, and the allowing of unfettered public protest in the hope that Libyans in cities still under Gaddafi’s control will seize the opportunity to rise up.

The British foreign secretary, William Hague, backed the revolutionaries’ position saying that Gaddafi must go and that a new ceasefire would have to meet the UN requirement for a withdrawal of his forces from cities they are attacking.  “Anything short of this would be a betrayal of the people of Libya and would play into the hands of the regime, which has announced two utterly meaningless ceasefires since the fighting began without its vicious military campaign missing a single beat,” the foreign secretary said.

Jalil also rejected the AU’s proposal for a cessation of Nato air strikes. “If it were not for the air strikes carried out by the coalition forces and Nato we would not now be at this meeting,” he said. The AU’s proposal for an end to the air strikes was also met with scepticism by Nato. Anders Fogh Rasmussen, the Nato secretary general, said that for a ceasefire to work it would need to be “credible and verifiable”, suggesting that international monitors would need to be deployed on the ground in Libya, but that it was “too early” for this.

“We need to establish an effective monitoring mechanism if a ceasefire is to be credible,” he said.  Jalil said that the revolutionary council had confronted the AU delegation with evidence that mercenaries from several African countries were fighting for Gaddafi, particularly from Algeria.

The AU delegation – made up of South Africa, Uganda, Mauritania, Congo-Brazzaville and Mali – left the talks looking glum, without making a public comment and to the derisive shouts of the protesters outside the hotel.  The revolutionary leadership was distrustful of the AU initiative from the beginning. Gaddafi used Libya’s oil wealth to buy greater influence in Africa after his aspirations to forge an Arab union were spurned. The AU delegation included the leaders of countries that have taken money from Gaddafi as well as South Africa’s president, Jacob Zuma, whose party, the African National Congress, has accepted considerable donations from the Libyan leader.

The rebels were disturbed to see Zuma refer to the Libyan dictator as “brother leader”. The South African leader did not travel on to the Benghazi meeting.  While Gaddafi told the AU he was ready for a ceasefire, his forces continued their onslaught against Misrata. Unicef warned that thousands of children in the city were in grave danger.

At least 20 children, mostly under the age of 10, have been killed in the besieged city in the past month, according to Unicef. Many more have been injured by gunfire or shrapnel from mortars and tank shells. “More and more children in this city are being killed, injured and denied their essential needs due to the fighting,” said Shahida Azfar of Unicef. “Until the fighting stops we face the intolerable inevitability of children continuing to die and suffer in this war zone.”

At least 250 people in the town, mostly civilians, have died in the past month according to two doctors interviewed by phone by Human Rights Watch (HRW). “The Libyan government’s near-siege of Misrata has not prevented reports of serious abuses getting out,” said Sarah Leah Whitson of HRW. “We’ve heard disturbing accounts of shelling and shooting at a clinic and in populated areas, killing civilians where no battle was raging.”

Sovereign Of the Week: Anna Hazare (Fasting against corruption)

Hunger striking Indian activist Anna Hazare has called for mass protests by his supporters against corruption. The 72-year-old campaigner is on the fourth day of a fast to push for stringent new anti-corruption laws. He wants his followers to “fill India’s jails” in a mass campaign of non-violent civil disobedience on 13 April.

Thousands of people have joined Mr Hazare’s protest. In recent months India has been rocked by a string of corruption scandals. On Thursday, the government agreed to include civil society members in a new panel which Mr Hazare is demanding be set up to draft tighter anti-corruption legislation. But differences remain over who will lead the panel and whether it will have legal powers.

Mr Hazare has said he wants the “jail bharo” (fill the prison) movement to take place across India. “But you should participate in the agitation keeping in mind Mahatma Gandhi. There should be no violence anywhere,” he told his supporters.

India’s governing Congress party leader Sonia Gandhi has urged Mr Hazare to give up his fast. She said his views would receive the government’s “full attention” in the fight against corruption. Doctors are checking Mr Hazare twice a day to monitor his health. The 72-year-old says he will refuse food until the government accedes to his demands.

There has been widespread support for Mr Hazare with protests and hunger strikes reported across India. Some 2,000 people have joined the activist at the historic Jantar Mantar observatory in Delhi, where he is conducting his fast. Correspondents say Mr Hazare has rallied people across the country disillusioned with the recent spate of scandals – he is highly respected as a social activist with an untarnished reputation.

Some of the recent corruption scandals to have angered Indians include a multi-billion dollar alleged telecoms scam, alleged financial malpractices in connection with the 2010 Delhi Commonwealth Games and allegations that houses for war widows were diverted to civil servants.

Last month the head of the country’s anti-corruption watchdog was forced to resign by the Supreme Court on the grounds that he himself faced corruption charges.

Charles Kenny- Dont Mess With Taxes

Published in Foreign Policy

Every spring, the Tax Foundation, a Washington-based advocacy group, announces Tax Freedom Day: the date by which the average employed American will have earned enough income to pay off his or her taxes for the year. This year, that day will be April 12. The Adam Smith Institute, a London-based, free-market think tank that makes a similar calculation for Britain, suggests that British taxpayers will have to work until around May 30 to pay off their own dues.

Tax Freedom Day is a clever-enough gimmick if your aim is to stir up ire over the government stealing income that rightfully belongs to the good people who have earned it through the toil of their labors. In an environment where Joe “the Plumber” Wurzelbacher is considered an expert on fiscal policy, it might even work. But it is worth remembering that, from a global perspective, how much we earn is actually 95 percent luck and maybe 5 percent toil. And it isn’t heavy-taxing big government that affects your income — it’s bad government.

The idea that anyone who works hard enough can become rich is a powerful one; for Americans, it’s not just appealing but central to national identity. The problem is that this vision of social mobility doesn’t hold true within the United States — and on a global scale, it’s just plain silly. The reason you earned as much as you did last year has far less to do with how hard you worked than with where and to whom you were born. In the United States, of those children born to parents in the bottom 10 percent of incomes, around one-third remain at the bottom as adults, and over half remain in the bottom 20 percent. Only one out of 77 children born into the bottom 10 percent of incomes reaches the top 10 percent as an adult, according to Samuel Bowles and Herbert Gintis writing in the Journal of Economic Perspectives.

But the advantages of being born rich rather than poor in America — large though they are — pale in comparison with the advantages of being born in a wealthy country rather than a developing one. The average rural Zambian will enjoy a lifetime income of about $10,000, compared with a lifetime income of around $4.5 million for the average resident of New York City. That’s not because Zambians are all soulless and corrupt. It’s because a Zambian with the same skills, intelligence, and drive earns a lot less in Zambia than she would in the United States — as is made abundantly clear every time a Zambian moves to the United States and starts earning a lot. The same people doing exactly the same job earn much, much more if they move from a poor to a rich country to do that job. In 1995, a construction carpenter’s wage in India was $42 a month. In Mexico, it was $125 a month. A South Korean carpenter, by contrast, made almost 10 times what his Mexican counterpart did; an American one made almost 20 times more.

For those of us lucky enough to be living in a rich country, are taxes really holding us back from a life of ease? In a word, no. Over the (not very) long term, it isn’t tax rates that decide how much money you take home — it is rates of economic growth. If a British person in 1984 paid no taxes at all, receiving as manna from heaven infrastructure, health care, education, policing, pensions, welfare benefits, and all the other services that the state provides, his or her take-home income (adjusted for inflation) would still be below that of post-tax Britons today. The same would be true of an American in 1988. People in the West are lucky enough to have been born in — or nearly as lucky to have moved to — countries that have seen a lot of economic growth over the past two centuries. That’s the reason they’re rich.

 Of course, an anti-tax advocate would respond that low taxes and a correspondingly small government are the secret to a country’s riches — an idea that is appealing, widespread, and very wrong. The last 100 years or so have seen the fastest rates of global economic growth in history; they’ve also seen the biggest governments of all time. From William Easterly and Sergio Rebelo writing for the National Bureau of Economic Research to Ross Levine and David Renelt in the American Economic Review (as well as numerous other analyses), economists have consistently failed to find robust cross-country evidence that a government’s size — measured by tax take or spending as a percentage of GDP — has any bearing, positive or negative, on its economic growth. Want further proof? Many developing countries see personal income tax receipts that would make a Tea Partier tip his tri-cornered hat in admiration, amounting to less than 2 percent of GDP. If a small income tax burden really was the determining factor in driving growth, those countries would all be richer than Luxembourg.

But while there isn’t a proven link between government size and economic growth, there is an important relationship between the quality of government and growth. If a government can’t ensure a basic level of security, stability, fair dealing, and public goods like infrastructure and education, whether it’s large or small is irrelevant — that country will be poor. If the government is providing those basic requirements, it doesn’t matter if it’s also blowing 10 percent of its GDP on bridges to nowhere, high-tech bombers for the last war, or corporate subsidies for ethanol production — that country will be rich. Better government equals richer people — it is as simple as that.

So why do rich people think it is all about effort rather than the luck of the draw? For one thing, there’s the oft-repeated finding from social psychology that people blame their own failures on circumstances beyond their control (“I was fired because the boss never liked me”) and the failures of others on personal flaws (“He was fired because he never did any work”). The reverse also holds: People take far more credit than they should for successful performance as part of a group, particularly if they do not know other group members personally. All of us — not only the rich — are just incredibly narcissistic by nature.

The second factor is that when we make comparisons it is usually to our peers, not the world as a whole. And our peers tend to have gone to the same type of school, work in the same field, and live in the same part of the world. Within these narrow groups, income differences — however small on a national or global scale — are more likely to be about ability and hard work. The fact that you earn more than your colleague who joined the firm at the same time as you did probably does have something to do with your different personal characteristics. The fact that you earn more than a peasant farmer in Lesotho doesn’t. At the same time, you rarely stop to care about how much a peasant farmer in Lesotho earns — despite the fact that the income gap between you and the farmer is many multiples larger than the gap between you and your colleague. However powerful our psychological foibles and narrow frames of reference may be, though, they are beside the point when it comes to public policy.

There are lots of reasons to hate current tax codes — not least because they are ridiculously complex and stuffed with loopholes for groups that can afford the best lobbyists. And governments the world over remain wasteful and spendthrift — including America’s, of course. Especially in poor countries, people ought to be focused on making government more efficient, equitable, and transparent — an effort that will entail lower government revenues in some cases and less government regulation in lots of cases. But the focus should be on better government, not smaller government. And the idea that taxation takes money that is rightfully ours alone, or that if only we managed to reduce the tax burden by a few percentage points we’d all be rich, is laughable. If you are in a wealthy country and it is tax time, be thankful you live somewhere where government works — and pay up.

Don Tapscott: The world’s unemployed youth: revolution in the air? (The Guardian)

youth unemployment rally
A common thread to the revolutions in Tunisia and Egypt and protests elsewhere in the Middle East and north Africa is the soul-crushing high rate of youth unemployment. Twenty-four percent of young people in the region cannot find jobs. To be sure, protesters were also agitating for democracy, but nonexistent employment opportunities were the powerful catalyst.

Youth unemployment is similarly dire in other parts of the world. In the UK, young people aged 16 to 24 account for about 40% of all unemployed, which means almost 1 million young adults are jobless. In Spain more than 40% of young people are unemployed. In France the rate is more than 20%, and in the US it’s 21%. In country after country, many young people have given up looking for work. A recent survey in the UK revealed that more than half of the 18- to 25-year-olds questioned said they were thinking of emigrating because of the lack of job prospects.

Unemployed young people comprised a large portion of the crowd that marched in London on March 26 to protest against the economic policies of the government. Fortunately, the protest was largely peaceful. But youth unemployment will continue to stay high, and the coalition’s austerity measures are not going to help. We’re deluding ourselves if we believe the young will simply continue to be stoical and deferential to authority.

Today’s society is failing to deliver on its promise to young people. We said that if they worked hard, stayed out of trouble, and attended school, they would have a prosperous and fulfilling life. It turns out we were inaccurate, if not dishonest. And then we rub salt in the wound by saying we’re in a “jobless recovery” – an oxymoron to tens of millions of young people who are having their hopes dashed.

Widespread youth unemployment is one facet of a deeper failure. The society we are passing to today’s young people is seriously damaged. Most of the institutions that have served us well for decades – even centuries – seem frozen and unable to move forward. The global economy, our financial services industry, governments, healthcare, the media and our institutions for solving global problems like the UN are all struggling. I’m convinced that the industrial age and its institutions are finally running out of gas. It is young people who are bearing the brunt of our failures.

Full of zeal and relatively free of responsibilities, youth are traditionally the generation most inclined to question the status quo and authority. Fifty years ago, babyboomers had access to information through the new marvel of television, and as they became university-age and delayed having families, many had time to challenge government policies and social norms. Youth radicalisation swept the world, culminating in explosive protests, violence and government crackdowns across Europe, Asia and North America.

In Paris in May 1968, protests that began as student sit-ins challenging the Charles de Gaulle government and the capitalist system culminated in a two-week general strike involving more than 11 million workers. Youth played a key role in the so-called Prague Spring in Czechoslovakia that same year. In West Germany, the student movement gained momentum in the late 60s. In the US, youth radicalisation began with the civil rights movement and extended into movements for women’s rights and other issues, and culminated in the Vietnam war protests.

Young people today have a demographic clout similar to that of their once-rebellious parents. In North America, the baby boom echo is larger than the boom itself. In South America the demographic bulge is huge and even bigger in Africa, the Middle East and Asia. A majority of people in the world are under the age of 30 and a whopping 27% under the age of 15.

The 60s baby boomer radicalisation was based on youthful hope and ideology. Protesters championed the opposition to war, a celebration of youth culture, and the possibilities for a new kind of social order. Today’s simmering youth radicalisation is much different. It is rooted not only in unemployment, but personal broken hopes, mistreatment, and injustice. Young people are alienated; witness the dropping young voter turnout for elections. They are turning their backs on the system.

Most worryingly, today’s youth have at their fingertips the internet, the most powerful tool ever for finding out what’s going on, informing others and organising collective responses. Internet-based digital tools such as Twitter, Facebook and YouTube were instrumental to the Tunisian and Egyptian revolutions.

We need to make the creation of new jobs a top priority. We need to reinvent our institutions, everything from the financial industry to our models of education and science to kickstart a new global economy. We need to engage today’s young people, not jack up tuition fees and cut back on retraining. We need to nurture their drive, passion and expertise. We need to help them take advantage of new web-based tools and become involved in making the world more prosperous, just and sustainable.

If we don’t take such measures, we run the risk of a generational conflict that could make the radicalisation of youth in Europe and North America in the 1960s pale in comparison.

The Root: More Black Men in Jail now than ever were enslaved


ColorLines’ Thoai Lu is reporting that the U.S. Bureau of Justice Statistics estimates that as of 2008, there were more than 846,000 black men in prison, making up 40.2 percent of all inmates in the system. The article highlights a recent talk given by author Michelle Alexander, who puts those numbers in context.

Alexander, author of The New Jim Crow: Mass Incarceration in the Age of Colorblindness, told an audience at the Pasadena Branch of the American Civil Liberties Union, “More African-American men are in prison or jail, on probation or parole than were enslaved in 1850, before the Civil War began.”

Alexander argues that prisons have become the latest form of economic and social disenfranchisement for young people of color, particularly black men. In it, she grapples with a central question: If crime rates have fluctuated over the years and are now at historical lows, then why have rates of incarcerated men of color skyrocketed over the past 30 years?

The “war on drugs,” which focuses primarily on communities of color, is the answer, although multiple studies have proved that whites use and sell illegal drugs at rates equal to or higher than blacks. Despite this data, four of five black youths in some inner-city communities can expect to be incarcerated in their lifetimes.

Alexander discusses how convicted felons are subject to forms of discrimination reminiscent of the Jim Crow era. This includes being denied the right to vote, automatically excluded from juries and legally discriminated against in employment, housing, access to education and public benefits, much like their parents or grandparents. 

Alexander raises a pressing issue as states like Florida move to privatize prison systems and strip convicted felons of the right to vote even after completing their sentences. The only thing sadder than having more men in prison now than in slavery during 1850 is that many don’t understand that slavery is still legal within the prison system. Indeed, it is the only place where slavery is still legal in the United States. It is clear that our community is in trouble. What are we going to do about it?

Alex Pickerman- Our Protest against the cuts was peaceful

Published in the Guardian.

On Saturday hundreds of thousands took to the streets of London to protest against the cuts. The turnout was much bigger than expected, and the message was clear: people in Britain are totally opposed to the government’s choice to prioritise the needs of bankers and big business over those of ordinary citizens.

Hundreds of people marched as UK Uncut and, instead of attending the main rally, went to Oxford Street, the heart of London’s shopping district, to occupy for the alternative. A diverse mass movement has been born.  The UK Uncut actions included people dressing as doctors to transform tax avoider Boots into a hospital, in protest against the £20bn cuts to the NHS. BHS on Oxford Street (part of Philip Green‘s empire) was closed as actors and musicians gathered outside to protest against arts cuts, with Sam and Timothy West staging an extract from The Voysey Inheritance by Granville Barker.

In nearby Soho Square an open air comedy venue was created, where Josie Long and Mark Thomas performed to an audience of nearly a thousand. These actions continued in the creative, fun and inclusive vein that UK Uncut has become known for, highlighting the tax gap and the injustice of bailing out the banks that caused the financial crisis and are awarding their bosses grotesque bonuses.

The UK Uncut actions were organised to work in tandem with the TUC March for the Alternative in order to make space for people wanting to engage in creative civil disobedience as their way of expressing opposition to the cuts. It was positive. It was in solidarity. We were not seeking to grab headlines – we did what we always do, engage in creative sit-down protest. We are all in this together.

At 3.30pm we gathered on Oxford Street and moved toward a new tax-dodging target, Fortnum & Mason, to stage an occupation. This foodstore is owned by Whittington Investments, which runs a devious tax avoidance scheme, stuffing money in Luxembourg and avoiding £10m a year in tax. This money could pay for about 500 nurses.

Over the last six months UK Uncut has creatively occupied shops owned by various tax dodgers. Last Saturday was no different. Inside Fortnum & Mason about 150 people read books, sang songs, held up banners and listened to music – creative civil disobedience against the cuts. We had many of the store’s staff engaging with us and wanting to know more; people in the cafe carried on eating their crumpets quite happily.

Balloons and beachballs were the only things being thrown in the air. A basket of chocolates was accidentally knocked over so we picked them up. We weren’t even asked to leave.  There has been tremendous confusion in the media about what UK Uncut had organised. Some on Twitter have been asking whether we should have organised an action at the same time as the march. Some who attended the march feel we hijacked their event. To this we say: “We are with you, and our occupations were in no way an attempt to grab headlines.”

There has been anger directed at us because some media outlets incorrectly used our name for actions we did not organise, giving every action the name UK Uncut. But it is clear, if you spend two minutes on our website, who we are, what we are about, and what our plans were. More accurate, grassroots reporting is emerging that tells the true story. UK Uncut will continue to take part in creative civil disobedience against the cuts, to ensure government and big business do not get away with making ordinary people pay for a crisis they did not cause.