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May 18, 2008 8:28 pm
Public opinion across Europe, Asia and the US is strikingly consistent in considering that the gap between rich and poor is too wide and that the wealthy should pay more taxes.
Income inequality has emerged as a highly contentious political issue in many countries as the latest wave of globalisation has created a “superclass” of rich people.
A United National Development Programme report in 2005 estimated that the world’s richest 50 people were earning more than the 416m poorest.
According to the latest FT/Harris poll, strong majorities in five European countries – ranging from 76 per cent in Spain to 87 per cent in Germany – consider that income inequality is too great.
But 78 per cent of respondents in the US, traditionally seen as more tolerant of income inequality, also think the gap is too wide.
The gap between rich and poor has become a central issue in the US presidential race, with Democratic party candidates railing against chief executives and bankers paying themselves massive bonuses while sacking workers or foreclosing on their mortgages.
A report published last month by the Center on Budget and Policy Priorities and the Economic Policy Institute found that low- and middle-income families in the US had reaped few gains since the 1990s, in spite of the economy’s overall expansion.
Average incomes for those in the bottom fifth of the pay scale had even fallen 2.5 per cent while rising 9 per cent among the top fifth.
For the first time, the FT/Harris poll surveyed opinion in Asia. In China, which has experienced three decades of helter-skelter development, 80 per cent of respondents think income inequality is too great.
However, Japan recorded the lowest figure of all countries surveyed, with 64 per cent.
In spite of the evident public concern about income inequality, few respondents think the gap will narrow soon, except in China.
Strong majorities in all eight countries surveyed consider that income inequality will widen even more over the next five years.
Clear majorities in all countries agree that taxes should be raised on the rich and lowered on the poor. In Britain, 74 per cent of respondents think that those on low incomes should be taxed less, helping to explain the furore that surrounded the Labour government’s decision to abolish the 10p income tax rate.
Last week Gordon Brown, prime minister, was forced into a humiliating retreat on this proposal by offering a £2.7bn (€3.4bn, £5.3bn) tax package in compensation. The weakest support for raising taxes is in France, which is already one of the world’s highest-taxed countries.
US respondents were the most resistant to the idea of lowering taxes on the poor, with 27 per cent agreeing with the proposition that taxes should be kept at current levels.
The FT/Harris online opinion poll, covering 8,748 respondents in eight countries, was conducted be-tween April 30 and May 12.
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