Economic Nonsense: 6. The rich are growing richer, the poor poorer and the gap is widening


Sometimes this is asserted on a world scale, and sometimes claimed to be true within individual countries.  Not only is this nonsense; it is also false.  The rich have indeed grown richer, and the poor have also grown richer.  It matters more to poor people.  Extra wealth to the rich might mean more luxuries; to the poor it can mean the difference between starvation and survival. The last few decades have witnessed the greatest advance in living standards for the world's poor than ever before in human history.  More than a billion people have been lifted above subsistence.  The poor have not become poorer, they have become richer to a spectacular degree.  India and Chine have made astonishing advances, but it has not been confined to them; other countries have seen their poor become wealthier, and it is still happening.

Within rich countries the poor have become richer.  The yardstick that matters is the one that tells us how much they can buy.  In terms of the hours of work needed to buy goods, they are much better off than they were decades ago.  In some cases what used to take weeks of work to buy now takes less than a day.

Those who make this false claim are concerned with equality rather than wealth.  If the poor gain wealth, but the rich gain more, then under their perverse way of regarding things, they regard the poor as having become poorer.  If achieving twice the spending power is called "becoming poorer," then words have lost their meaning.

On a world scale decades ago there were a handful of rich countries with the rest dirt poor.  Since then many poorer countries have climbed the ladder to wealth, and others are doing so.  Globalization and the spread of market economics have brought an explosion of wealth that has been widespread and beneficial, and promises to continue being so.