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Rich growing richer at the cost of poor

Pakistan’s economy has not done badly in the last two decades and per capita income in the country rose from $612 in 2003 to $1,295 in 2013 despite deteriorated internal security and frequent natural disasters, according to the International Monetary Fund. But participants in a discussion on inequality, arranged by SDPI and Oxfam here on Wednesday, learnt that the doubling of national income benefited the poor of the country the least.

“In urban areas, the top 20 per cent of the population take 61 per cent of the monthly income in comparison to 3.45 per cent of the bottom 20 per cent,” informed Babar Jamal of the Sustainable Development Policy Institute.

Even advanced economies are worrying about the economic costs of the rising income and wealth inequalities. They are debating the issue but little is heard about it in Pakistan where income, gender and regional inequalities exist in extreme forms.

“Elite captured political institutions shifting income and wealth from the poor to the rich through various instruments including indirect taxation and setting public spending priorities which help the rich get richer. This vicious cycle of power generating wealth and wealth bolstering power is the key structural development problem in Pakistan,” concluded SDPI experts.

Ben Phlilips, Oxfam’s director of campaigns, recalled that his organisation’s disclosure that 85 richest people in the world have the same wealth as the 3.5 billion people forming the bottom half of the world’s population, shook even the rich who gathered at Davos this year.

“Across the world the public is calling for action to tackle extreme inequality. Education and health for all are possible. Those with the most to spare should contribute the most in taxes,” he said, extending Oxfam’s cooperation to Pakistani activists in building “societies where everyone matters”.

Even pro-poor laws work where the civil society is active, he reminded.

Active movements have improved social justice and wealth distribution in Brazil and Bolivia and Sweden has become the place to live the American dream instead of the United States where the richest 10 per cent captured all the growth since the latest recession hit the sole super power, he noted.

Journalist Shahidur Rehman, whose book ‘Who owns Pakistan’ caused a stir in the late 1990s, asked him what help should be expected in tracking down “the filthy rich of Pakistan” who don’t keep corporate assets in their names and stash away their ill-gotten wealth in off-shore British havens.

“It needs global action. British off-shore territories have one-third of the $18 trillion kept in such havens. G-8 and G-20 countries are tackling the problem but only to help each other, not the poor countries,” responded the Oxfam official.

Ben Phillips also received a sharp rebuff from his Pakistani Oxfam colleague, Mustafa Talpur, for saying that “inequality is inevitable but not of this [current] level”.

“Of course inequality is inherent in the capitalist system but not inevitable,” Talpur said.

“I have spent five years with downtrodden Hindu Kohlis in Sindh who take their misery as their destiny. Such pessimism has become national psyche where martial law is taken to be our destiny.”

A participant made the anchorperson uneasy when he launched his woes in Urdu.

“I see inequality at my own level. My vote is sought for national level politics when my and my community’s problems are local. We can think of higher levels after we have control over local affairs,” he said, hinting at the near consensus among the ruling national political parties not to allow meaningful local governments.

Article written by Anwar Ali Mansuri, Published in Dawn, June 19th, 2014

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