Something from just over a week ago.
The Sunday Times reported ('S'pore income gap will narrow: MM', Jan 21) MM saying that the income gap in Singapore will narrow. Reason: incomes at the top end (i.e., professionals, etc) will eventually be depressed due to competition from the 'emerging economies', much like how lower end salaries are now depressed due to competition from 'cheap labour' in these economies. If I understand this correctly, it means that in time to come, the smaller top end salaries of these emerging economies will bring down the salary levels of the top end here.
I'm really lousy in economics. Do economies - mature as well as emerging ones - actually see their income gaps reduce over time?
The next day, there was this ST article ('Ranks of wealthy surge as US economy booms', Jan 22), which says, 'but the income gap between the rich and poor is also the steepest in decades'. It quoted Forbes magazine saying that there were at least 400 billionaires in the US last year. However, it also said that 'US corporate chief executives were paid on average 262 times the salary of an average worker' in the same period.
This Democratic Party person, Barney Frank, was quoted commenting on the idea that 'a rising tide lifts all boats' - everyone will benefit when the economy grows, which is often cited as a plus point of globalisation and booming economies. He said:
'The rising tide is a very good idea if you have a boat... But if you are too poor to afford a boat and you are standing tiptoe in the water, the rising tide goes up your nose.'
I like what he said. We often assume that everyone is on some boat or other, and that the problem is just that some have cruise liners and others have aircraft carriers while some have sampans and others have rafts. It's all too true, isn't it, that some don't even have that raft, others are still on the shore, and yet others don't even know they have to get off the shore?
Something else which I found interesting in this article was the point that with the new wealthy, the US saw 'a surging market for luxury goods as well as a new era of philanthropy'.
At least that's a silver lining for them.
The Sunday Times reported ('S'pore income gap will narrow: MM', Jan 21) MM saying that the income gap in Singapore will narrow. Reason: incomes at the top end (i.e., professionals, etc) will eventually be depressed due to competition from the 'emerging economies', much like how lower end salaries are now depressed due to competition from 'cheap labour' in these economies. If I understand this correctly, it means that in time to come, the smaller top end salaries of these emerging economies will bring down the salary levels of the top end here.
I'm really lousy in economics. Do economies - mature as well as emerging ones - actually see their income gaps reduce over time?
The next day, there was this ST article ('Ranks of wealthy surge as US economy booms', Jan 22), which says, 'but the income gap between the rich and poor is also the steepest in decades'. It quoted Forbes magazine saying that there were at least 400 billionaires in the US last year. However, it also said that 'US corporate chief executives were paid on average 262 times the salary of an average worker' in the same period.
This Democratic Party person, Barney Frank, was quoted commenting on the idea that 'a rising tide lifts all boats' - everyone will benefit when the economy grows, which is often cited as a plus point of globalisation and booming economies. He said:
'The rising tide is a very good idea if you have a boat... But if you are too poor to afford a boat and you are standing tiptoe in the water, the rising tide goes up your nose.'
I like what he said. We often assume that everyone is on some boat or other, and that the problem is just that some have cruise liners and others have aircraft carriers while some have sampans and others have rafts. It's all too true, isn't it, that some don't even have that raft, others are still on the shore, and yet others don't even know they have to get off the shore?
Something else which I found interesting in this article was the point that with the new wealthy, the US saw 'a surging market for luxury goods as well as a new era of philanthropy'.
At least that's a silver lining for them.
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