Jan 26 2011

Gap Between Rich And Poor Named 8th Wonder Of The World

Posted by: Nick Shaxson in: Thoughts

The relentlessly funny The Onion (hat tip: Sarah) is carrying a superb story:

At a press conference Tuesday, the World Heritage Committee officially recognized the Gap Between Rich and Poor as the “Eighth Wonder of the World,” describing the global wealth divide as the “most colossal and enduring of mankind’s creations.

The vast chasm of wealth, which stretches across most of the inhabited world, attracts millions of stunned observers each year, many of whom have found its immensity too overwhelming even to contemplate. By far the largest man-made structure on Earth, it is readily visible from locations as far-flung as Eastern Europe, China, Africa, and Brazil, as well as all 50 U.S. states.

When I stare out across its astounding breadth, I’m often moved to tears,” said Johannesburg resident Grace Ngubane, 31, whose home is situated on one of the widest sections of the gap. “The scale is staggering—it makes you feel really, really small.”

Indeed. See some recent real stuff on inequality here and here. But there’s something else I’d like to note. The published numbers on inequality vastly underestimate the scale of the inequality problem. This is because so much of the wealth is held offshore – where it becomes impossible to identify who the real owner of an asset is. If you can’t identify the owner, then you can’t plug the asset (and its income stream, if there is one) into the inequality database. This is especially important when we get into the murky world of trusts, which create shame separateness between owners and assets. More on this soon.

2 comments so far

Cos67 2th February, 2011 7.02 pm

who cut the onion in here? My eyes are watering. Maybe it’s the laughter.
Nevermind.

Great work, Nick
Awesome blog, too.

Ok, that’s good, but I think that the focus of finance institutions should be on revising current models for micro finance. They hardly can be considered to be efficient. Just think, we have about tree billion people — and that’s close to half of the human population of the planet — who still live on less than $2 a day. And check this out, 2 thirds of them, which is two billion, remain absolutely “unbanked” – means don’t have any access to traditional financial systems. So the coverage of the alliances in the industry must be much wider.

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