Monday, March 5, 2012

US inequality much greater than China's

There were some important points made in response to the blog I put up the other day about the wealth of the Chinese legislators, information I had shared from a piece in Business Week.  I thought it would be important to share them with readers of the blog as the Bloomberg piece I quoted clearly intends to show that inequality is greater in China than the US which is not the case. Thanks to the comrades for their clarification.


Pat Byrne wrote:

The statistics on the incredible level of wealth owned by the Communist Party elite are very interesting but the comparison that Bloomberg makes with the United States is highly misleading. By
comparing the wealth of legislators in China with legislators in the US they seek to demonstrate that China is a more unequal society. But they fail to compare wealth distribution in China with the US as a whole thus leaving out the wealth of the super-rich in the US. Of course legislators in the US are
far less wealthy as most wealth is held in private hands compared to China, a system where the large majority of economic activity is carried out by the state and run by an unaccountable bureaucracy.

This only confirms what we have been saying about the leading role of the state in China and why it is inaccurate to describe it as a capitalist country.    I also found the (China's) 16-point reform plan interesting. Unfortunately, it is a very partial plan leaving out large areas that need improvement. More important it lacks any proposals to fully democratise the whole system which has given rise to the inequalities and corruption in the first place.

Incidentally, this morning I watched the work report on 2011 that Premier Wen Jiabao presented to the National People's Congress yesterday. As part of what he described as the country's process of "socialist modernisation" he reported the following achievements for 2011:

9.2% GDP growth
24.8% increase of government revenue (an incredible statistic compared to
the debt situation of Western governments)
Grain output reached a record high of 570 million tons
12.21 million new urban jobs created
Urban real per capita disposable income rose by 8.4%
Rural real per capita disposable income rose by 11.4%
6.3 million hectares of trees were planted
Local government debt was thoroughly reviewed and corrections introduced.
Housing speculation drastically reduced
Inflation reduced to 4.5%
Urbanisation level has now passed 50% point
Universal 9 year education has now been achieved and illiteracy completely abolished among young and middle  aged Chinese

Among the targets for 2012 the following were reported:
To create more than 9 million new urban jobs
To complete 5 million units of low-income housing this year and start
construction of another 7 million units

And Ben Leet also commented:
About China: the wage of the typical manufacture worker doubled between 2002 and 2008 according to Dept. of Labor report, see Monthly Labor Review, March 2011, look at the chart in the back. Yet the wages of $1.36 an hour were 4% of U.S. manufacturer worker wages, of $34.00 an hour. Read the report. Here's another data set, China's GDP per adult is 1 tenth the GDP of USA, So productivity (output per hour) in US is ten times greater. In the US median net worth per adult is 1/5 the average wealth, in China net worth per adult is 1/3. Meaning they share their wealth better than we do. Put it this way, our median is $53,000, our average is (5 times that) $250,000, in China their median is $7,500, their average is around $21,000. This info from Credit Suisse bank World Wealth Report, 2011. China is much poorer

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