The Economist noted in January:
Hu Jintao, David Cameron, Warren Buffett and Dominique Strauss-Kahn ... have all worried, loudly and publicly, about the dangers of a rising gap between the rich and the rest.
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A new survey by the World Economic Forum, whose annual gathering of bigwigs in Davos begins on January 26th, says its members see widening economic disparities as one of the two main global risks over the next decade (alongside failings in global governance).
Numerous prominent economists in government and academia have all said that large inequalities can cause - or at least contribute to - financial crises, including:
•Robert Shiller
•Joseph Stiglitz
•John Kenneth Galbraith
•Raghuram Rajan
•Robert Reich
•Mark Thoma
•Emmanuel Saez
•Thomas Piketty
•David Moss
•Kemal Dervi
•Michael Kumhof
•Romain Rancière
•Robert Wade
•David Ruccio
•Marriner S. Eccles (Federal Reserve chairman from 1934 to 1948)
Add Alan Greenspan to the list, who says:
Our problem basically is that we have a very distorted economy, in the sense that there has been a significant recovery in our limited area of the economy amongst high-income individuals...
Large banks, who are doing much better and large corporations, whom you point out and everyone is pointing out, are in excellent shape. The rest of the economy, small business, small banks, and a very significant amount of the labour force, which is in tragic unemployment, long-term unemployment - that is pulling the economy apart. The average of those two is what we are looking at - that they are fundamentally two separate types of economies.
And several IMF economists. As Bnet wrote in May:
(See the rest at link).
Poster Comment:
It's fairly long but an interesting and thoughtful read and even has a chart for the chart obsessed here.
