Friday, April 20, 2012

Blog #13 Rising income inequality a threat to Asia’s growth, stability: ADB


The article is about the widening rich-poor divide that is threating Asia’s growth and stability.  The article says that governments and address the problem by spending more on education and health, creating quality jobs and investing in infrastructure.  This could reduce social problems that can lead to inefficient populous policies.  The recent growth in Asia should have brought 240 million people (6.5% of the population) out of poverty.  Instead inequality grew larger as economic growth took off.  This year Asia is set to grow slower than last year.  Income in the Richest house-holds has increased with 20% of the total income taken by the wealthiest 5% In most of the region.   The article points out that the growth has been from technological progress, globalization, and market-oriented reform, which are the same factors that created the divide between the rich and poor.  The poor people that don’t have access to learn these skills will not take part in the economic growth.  
 
This what’s happening here in the article seems to be a trend that is happening in several other countries.  Income inequality is rising because the rich are getting richer and the poor are not getting and richer.  It’s as though the poor pour are locked out of this circle of prosperity.  I think the article puts out a good solution with improving education and investing in infrastructure as long as this extra spending in education will go to the poor and to those that don’t have access to learn the skills that are valued now and where the growth is coming from.  The growth as a country as a whole is great and makes the Global income inequality seem likes its going down however it’s not a real reduction in Inequality because the shrinking in global inequality is matched with a gain of inequality in those countries that are shrinking the global inequality.   The world is become more divided as a whole as other rich people in countries are getting richer and the poor are staying poor.

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