MacroScope

Growth not enough to ease inequality: Oxfam

Rising income inequality in rich nations has cast doubt on the old adage, often upheld by the economics profession, that a rising tide lifts all boats. A new report from Oxfam reinforces the notion that wealth does not trickle down of its own accord. The anti-poverty advocacy group says sometimes actively redistributive policies may be needed to address huge income gaps. It also says that, contrary to conventional economic thinking, such policies will directly contribute to better growth rather than impede it.

Inequality, often viewed as an inevitable result of economic progress, in fact acts as a brake on growth. Among the best ways to assure inclusive, sustainable growth and fight poverty, finds the study, are policies that reduce inequality. […]

Inequality erodes the social fabric, and severely limits individuals’opportunities to escape poverty. Where income inequality is high or growing, the evidence is clear that economic growth has significantly less impact on poverty: a trickle-down approach does not work.

The report notes that the United States is the most unequal of the world’s wealthy nations – but that’s old news. More interesting is the finding that even strong rates of growth will not be enough to lift more people out of poverty over the next decade, particularly in the less wealthy G20 nations. The report found that inequality increased in 14 of 18 G20 countries since 1990 despite rapid rates of growth in some countries. Oxfam recommends the following:

The exact policy mix should be tailored to each national context, but policies in successful developing countries suggest the following starting points:

Duelling protests hit Huntsville as G8 kicks off

G8 host Huntsville has been a picture of quiet in the run-up to the summit, which kicked off on Friday. Reporters that have come up to cover potential protests have had little luck so far uncovering anything beyond bemused residents and hundreds of bored cops.

So there was more than a little excitement Friday when not one, but two protests sprang up in the summer resort town’s center. A media stunt by Oxfam involving the group’s famous paper mache “heads” of world leaders drew a throng of reporters and camera crews to a waterfront park in the resort town’s center.

Oxfam activists pose as G8 leaders during a photo opportunity ahead of the G8/G20 summits in Huntsville, Ontario June 24, 2010. Oxfam urged the leaders to deliver their promises made in past G8 meetings. Canada hosts the 2010 G8/G20 summits from June 25 to 26 in Huntsville. (L-R) U.S. President Barack Obama, Canada's PM Stephen Harper and German Chancellor Angela Merkel. REUTERS/Carlo Allegri
Volunteers sporting the oversized heads and decked out like tourists (T-shirts, shorts, and sandals with white socks) pored over roadmaps apparently trying to find the right way forward on committing funds to eradicate poverty in the developing world.

Oxfam to G8: Act now on global poverty, maternal health

He has starred in such blockbuster films as Pirates of the Caribbean, as well as the upcoming Harry Potter and the Deathly Hallows, but actor Bill Nighy’s heart is set on his real life role as an ambassador for Oxfam.

Flanked by representatives from poor and developing nations from Africa and South America, Nighy was in Toronto on Thursday to ask global leaders gathering for the G8/G20 meetings this week to keep the promises they made a decade ago to reduce maternal mortality rates by 75 percent before 2015.

Nighy was fresh off the plane from Kenya, where he saw children competing with dogs to find scraps of food in garbage dumps. In some cases small girls are forced to sell their bodies for sex to dump kingpins who control areas with the best pickings, an emotional Nighy told reporters.