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Brazil, Where The Wealth Divide Is Particularly 'Obscene'

Symmetry in Sao Paulo
Symmetry in Sao Paulo
Clóvis Rossi


SAO PAULO —Â Two studies published in recent months show how inequality around the world is becoming even more obscene than before.

One such study is the UBS report on the rich that focuses on capital. The figures involved are predictably shocking, but one element in particular caught our attention: The wealth owned by the ultra-rich (those owning at least $30 million in assets, who represent just 0.004% of the world's adult population) grew by an average 6.6% every year between 1992 and 2012.

These people saw their wealth rise at a similar rate as the booming Chinese economy, despite the fact that during part of this period of time, between 2008 and 2011, most of the world was mired in a deep financial crisis.

As for the workers, on the other hand, John Evans, a top official on trade at Paris-based OECD commented in a recent forum that "Governments and international institutions are not changing a business model drives profits up but still won't provide a minimum living wage of $177 a month in Cambodia or $120 in Bangladesh."

Sharan Burrow, the International Trade Union Confederation's General Secretary went further and said that "the rule for working people is uncertainty: low income, insecure jobs with little or no social protection are the reality for too many families."

None of this is new , of course. But it's still shocking, especially when we take a closer look at the data for Brazil .  Despite still being generally considered a poor country, Brazil ranks tenth for the number of millionaires, higher than rich countries such as Spain or Switzerland. .

Brazil v. USA

What's even more obscene, that group grew faster than in any other country in the world between 2013 and 2014, except for China . In that period, the number of millionaires shot up by about 350%. For the sake of comparison, in the United States, where the concentration of rich and ultra-rich is still higher than anywhere else on Earth, that number grew by a mere 20%.

Again, we're talking about a time when the economy is largely stagnating. But as we saw with the figures published by UBS, the global economic slowdown didn't even scratch those at the top.

Unbelievably, there are still people in Brazil who believe that Lula da Silva's and Dilma Rousseff's Workers' Party has reduced inequality. It hasn't .

What was reduced, if that's actually what happened, was the wage difference among different employees — but not the difference between the rate of capital accumulation and wages.

I must confess that I'm growing tired of working on this subject, but it wouldn't be honest to just walk away from it at a time when even the "rich-country club" OECD publishes a report  damning its own members. In the words of John Evans: "Rising income inequality is no longer just an ethical or normative issue — it has very tangible economic costs."

Not only does a deep wealth divide prevent a bona fide recovery from the crisis of the last decade, it limits opportunity for a new generation. In other words, steep income inequality affects not just the present, but our future.

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FOCUS: Russia-Ukraine War

Putinism Without Putin? USSR 2.0? Clean Slate? How Kremlin Succession Will Play Out

Since Russia's invasion of Ukraine, political commentators have consistently returned to the question of Putin's successor. Russia expert Andreas Umland foreshadows a potentially tumultuous transition, resulting in a new power regime. Whether this is more or less democratic than the current Putinist system, is difficult to predict.

Gathering in Moscow to congratulate Russia's President Vladimir Putin on his birthday.

Andreas Umland


STOCKHOLM — The Kremlin recently hinted that Vladimir Putin may remain as Russia's president until 2030. After the Constitution of the Russian Federation was amended in 2020, he may even extend his rule until 2036.

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However, it seems unlikely that Putin will remain in power for another decade. Too many risks have accumulated recently to count on a long gerontocratic rule for him and his entourage.

The most obvious and immediate risk factor for Putin's rule is the Russian-Ukrainian war. If Russia loses, the legitimacy of Putin and his regime will be threatened and they will likely collapse.

The rapid annexation of Crimea without hostilities in 2014 will ultimately be seen as the apex of his rule. Conversely, a protracted and bloody loss of the peninsula would be its nadir and probable demise.

Additional risk factors for the current Russian regime are related to further external challenges, for example, in the Caucasus. Other potentially dangerous factors for Putin are economic problems and their social consequences, environmental and industrial disasters, and domestic political instability.

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