One per cent versus 99 per cent in Bangladesh

Nilratan HalderIndia's top 100 on the list of the richest people have collectively lost 20 per cent of their net wealth since last year's ranking, according to the biweekly Forbes magazine's Indian edition. The practice of publishing the names of 400 richest Americans in September has continued since 1982, but now the magazine, which marks the 30th edition this year, focuses on the top billionaires the world over. Unfortunately, countries like Bangladesh do not make it to the list because of understandable reasons. There is no way to know if the country has billionaires, or if it has, how big an amount they possess. America in its hey day had to raise its bar to the level where no one having fortunes below US$ 1.0 billion stood any chance of being considered for the 400 club. But this had to be lowered again. If that is the case, quite a few Bangladeshis should well be there for reckoning. One of the reasons why our rich people's wealth may look smaller than what they actually have at their disposal is the portion that remains unaccounted for -black or 'undisclosed' money that is. Money smuggled out of the country is likely to be responsible to some extent. Be that as it may, what interests us is, if the rich in this country also have followed suit like their Indian counterparts. To laymen like us that seems most unlikely, because in skewed economies and in times of economic turmoil, when the majority of people are at the receiving end, some people keep well, indeed very well. In economies like those of the US and India, market manipulation is well-nigh impossible and that explains why no remedy other than bailouts was enough for the purpose in the American situation. Sure enough, corporate malfeasance and corruption in high places still bedevil emerging economies like India's but the spread of wealth along with the consolidation of economic base by the middle class has indeed provided the required boost for those economies. India's middle class is reportedly on course of a spending spree, if not profligacy. That sounds intriguing. The inflation of that country has not touched the double digit but then it is not far away from doing so either. Bangladesh's had gone up above 11 per cent in September and looks all set to go past the 12 per cent mark. Market volatility combines with a falling stock market to exacerbate the situation. Clearly, the government gives the impression of being in a quandary as to how to revive its capital market. In fact, its helplessness before the machinations resorted to by big shots has become all too evident. Then, its heavy borrowing from banks has been a cause for serious concern so much so that the World Bank had to warn of the danger. To put it in the right context, it is necessary to draw a comparison between the situation in Bangladesh and the US federal government's intervention in salvaging the banks and other financial institutions. Here the government has been compelled to borrow heavily mainly to run an expanded safety net programme for the poor and footing the bill of imported oil. No wonder, therefore, that the recent anti-capitalist protests under the banner "Occupy Wall Street" are actually exposing the weaknesses of free market economy which people still consider sine qua non for democracy to flourish. It is from the same premise that Forbes magazine actually wanted to celebrate individual entrepreneurship and business acumen through publication of names and by according celebrity status to them. The magazine's effort was richly rewarded when in 2006, four of the top five richest persons in America were college drop-outs. That premise still exists but alarming news such as the owning more than half of the world's wealth by just only two per cent adult people makes us sit up. A study, claimed to have been the most comprehensive ever undertaken on personal wealth, by the Helsinki-based World Institute for Development Economics Research of the United Nations University in 2006 found this 'extreme nature of inequality around the world'. At the same time half the world population owned barely one per cent of the global wealth. In 2000 though just one per cent of the world's richest people owned 40 per cent of its wealth and 10 per cent of the richest accounted for 85 per cent of the world's gross wealth. The international wealth gap has since assumed a different dimension with emerging economies headed by China going robust while the once strong US economy is showing signs of aging and wrinkles all over. The Occupy Wall Street movement is a reminder of the ailment capitalism is heir to. Its proponents rightly claim that in the battle for resources between one per cent and 99 per cent, their cause is stronger and stands to win. Anuradha Mittal of the California-based Oakland Institute shows how unfettered free trade often put forward as a recipe for reducing the international wealth gap ends up benefiting the wealthy at the expense of the poor. Bangladesh's garments sector is a perfect example of this. Such unregulated business increases 'wealth gap, both internationally and within many countries'. The alternative is not rosy either. What is therefore needed is to restrain corporate greed and introduce ever more liberal social welfare programmes that socialism once forced upon democracies.