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Stratification in Russia again, as on the eve of the 1905 revolution

Расслоение в России снова, как накануне революции 1905 года

If the average income per family member in Russia less than a living wage, it is considered that the family lives below the poverty line
 

According to the chamber, under this criterion, we have covered about 20 million citizens, or one in seven people (in detail we wrote in the article “Who are the poor?”). This is almost two times less than in 2000, but a third more than in 2012.

But while the poor grew poorer, the rich get richer: the number of dollar billionaires in Russia only grows. So, in the Forbes list for 2018 is more than 100 Russians with a combined fortune of more than $410 billion, But two years ago there were nearly three dozen less.

DIFFERENTIAL SOCIAL TENSION

A research group of economists, headed by Tom Piketty of the Paris school of Economics gives the following data: 1% of the richest citizens of Russia will receive 20% of the income of the whole country, half of them (10% of income) accounted for by the oligarchs – billionaires on the Forbes list (0.1% of the population). Finally, a standard based on 10% of the richest: they get 45% of the income of a country is the proportion, which was on the eve of the first Russian revolution в1905 year.

Fun fact: abroad Russian oligarchs hold about $1 trillion. This figure is comparable to the total value of all Russian households. Nothing else in the world. And uneven distribution of wealth in Russia is an absolute champion (see chart). Inequality is not just offensive, but dangerous.

The bigger the gap, the higher social tensions. Our government income inequality is trying to cut social benefits, raise the minimum wage. But on the return of a progressive income tax, when after a certain amount of personal income tax becomes much higher than standard 13%, not yet solved. With regard to property separation, there is generally no progress.

In many countries there are different taxes on wealth (luxury) – a progressive scale for expensive cars and real estate. We also present this formally, but the difference in tax rates is absolutely invisible. Or inheritance tax. If the United States heirs of any Rockefeller will pay a tidy sum for the possession of factories-steamships, the children of the Russian oligarch – a penny. Inheritance tax in Russia in 2006 canceled.

– Those who have attained wealth, try to consolidate your position and eliminate the threat of competition (equal opportunities. – Ed.). It is unprofitable to fight for equality, it is important for them to see themselves among the winners, – explains Ruben Enikolopov, rector of the Russian economic school (NES).

Economists notice that the ultimate goal of any transformation is not GDP growth as such, and it should improve the lives of as many living in the country. We have the same GDP growth has led to welfare of minorities separate piles. It is not surprising that the Russian reforms of the last years is not popular with the people.

– Knows who is working on such an economy, because wealth gives you the opportunity to influence the political process, says Sergei Guriev, chief economist of the European Bank for reconstruction and development. – To eliminate existing inequalities hinder populists from the authorities, who build a corrupt system, and move them in the elections is not possible. The business elite, the oligarchs are quite satisfied with the status quo.

If you go down to the level of Forbes list of the rich to ordinary managers and workers, there appears the concept of regional inequality in Russia it is one of the highest among developed countries. You may have guessed, about what speech? Yes, the standard of living, incomes in Moscow, St. Petersburg incomparably higher than in small towns in the farthest corners of the country. Inequality concerns access to quality health care, education. This is inequality of opportunity.

How increased this inequality is known – breakthrough primary accumulation of capital, or, if you prefer, the looting of the early 1990s But it’s been a quarter of a century. Many countries, such period to relieve the tension was enough.

Расслоение в России снова, как накануне революции 1905 года
A screenshot of the site kp.ru

LET THEM BE RICH BUT NOT BE POOR

According to the Organization for economic cooperation and development (OECD), the lowest bundle of income in Denmark, Slovenia, Slovakia and Norway. And the highest in Chile, Mexico, Turkey, Israel and the United States. While economists link quality of life level of democracy: examples of countries with a rich population under an authoritarian regime on the world map, only units. But I wonder why in democratic States, this level of inequality? It is appropriate to recall the anecdote about the noblewoman, surprised by the revolution of 1917.

– What you demand these people? – she asked the servant, hearing from the street noise of the rally.

– You want that was not rich, Madame.

Weird… My grandfather was a Decembrist went in 1825 to the area, on the contrary, that was not poor.

Income inequality in itself does not matter – much more important is the difference of access to necessary social goods, such as medicine, education, housing, etc. And with this in the USA more or less the order of the poor with everything necessary provided.

– Let the measure of inequality in the U.S. is higher than in Cambodia, however, the level of poverty in the latter disproportionately higher. So everything is relative, says the business consultant, Forbes columnist bill of Conerly.

Расслоение в России снова, как накануне революции 1905 года
A screenshot of the site kp.ru

NOT TO BRING UP THE EXPLOSION

Russia and China have much in common: vast territories and a decent gap in living standards between big cities and rural areas, and corruption of officials. Not to mention the socialist past.

The transition from a planned economy to a market economy in China has passed more smoothly and quietly than in Russia. However, the economic boom of the last decades has led him to the uneven distribution of income and wealth. Was a layer of very wealthy “new Chinese” have access to all the benefits of civilization, to send their children to receive education abroad.

But the level of poverty, which the government strongly fought with the help of a multi-year national programmes, has significantly decreased. Interestingly, in China today, especially low-skilled staff in demand: an acute lack of workers. Therefore, the salary of the lowest paid workers is increasing annually by 10%.

The rapid economic growth of recent decades in South Korea too an increase in inequality largely due to the hard economic and social policy of the state.

But there are countries where growing inequality eventually led to a social explosion. Talking about the Arab revolutions 2012. Monitoring orientalist-Arabist Marianne white, the so-called Arab spring has resulted in noticeable positive changes. Inequality in Tunisia or Egypt, of course, is not quickly reduced. But the government at least initiated a dialogue with the people – started democratic changes. And for political freedoms began and economic: in particular, was tempered appetites feeding in power clans.

Расслоение в России снова, как накануне революции 1905 года
A screenshot of the site kp.ru

CURRENCY EQUALITY

The end of dollar hegemony will lead to the reduction of tensions

The head of the Department of macroeconomic and geopolitical research of the investment company Barings Christopher Smart is a reminder that inequalities can be not only within countries but between them. Thus, the source of political and economic power in the international arena can be and currency. Illustrative example is the us dollar, which has become the touchstone of most international trade transactions.

In the next few years the sanctions will lead to the fact that the dollar will lose its power, and perhaps the country will turn their attention to the canadian, Australian dollars, Swiss franc or even the yuan. The more strong currencies, the less inequality in the world, he said.

 

 

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