The Instability of Inequality

This article attributes the rise in global protest movements to increasing inequality. It also looks at some of the reasons for rising inequality which take different forms across the globe. It argues that we have an aggregate demand problem that is a partial consequence of growing inequality. The segments of society that have a high propensity to consume don't have the money and the segments with the money consume a lower share of their income. In english speaking countries financial liberalization was used to enable consumption to expand by the use of household debt. In Europe government provided public goods such as education and healthcare that was funded by public debt. A solution these problems requires movement to a new economic model. The laissez faire economic model of Anglo-American states has not worked and the welfare models of Western Europe is unraveling.