Speaker 1: Hello, and welcome to Stephanomics, the podcast that brings the
Speaker 1: global economy to you, and that, of course was the
Speaker 1: mighty Mega Hunter t Rex, a toy you might want
Speaker 1: to buy your favorite three year old for Christmas this year.
Speaker 1: But with all the talk of global supply chain snarl ups,
Speaker 1: I know you're wondering, will those vital toy supplies from
Speaker 1: the North Pole and China get through and if so,
Speaker 1: what cost? Well, we have the very latest news from
Speaker 1: Hong Kong in a minute. We also have some hard
Speaker 1: numbers on the soaring wealth of the world's billionaires, and
Speaker 1: we take a few minutes to consider the new traffic
Speaker 1: light coalition in Germany and Angela Merkel's legacy after sixteen
Speaker 1: years as Chancellor. Stay tuned too if you want to
Speaker 1: find out what her staff gave her as a going
Speaker 1: a Way present this week. Clue, it's not socks and
Speaker 1: it's not a watch. But first, here's our senior correspondent
Speaker 1: in the current in Hong Kong with that vital update
Speaker 1: for anyone who has yet to finish their Christmas shopping
Speaker 1: m it's shaping up to be an expensive Christmas for
Speaker 1: Santa Claus. As the big supply crunch of one pushes
Speaker 1: up prices for toys. There's even a risk of some
Speaker 1: presents won't get to Santa Sligh in time. So I
Speaker 1: went along to meet Dave Cave, the owner of Dragon
Speaker 1: Eye Toys in Hong Kong, whose products include the Mighty
Speaker 1: Mega Hunter t Rex that you just heard, to find
Speaker 1: out the latest state of play for toymakers. But before
Speaker 1: we dive into the details, here's a dem of one
Speaker 1: of his dinosaurs. What we've done really well with should
Speaker 1: do a talk back junior megasaur. It has three play
Speaker 1: me functions on the actual dinosaur. It's about seven or
Speaker 1: eight in she's long, same in the height. It's a
Speaker 1: really cooled dinosaur. So when you press its foot, you
Speaker 1: hear it walking. When you press its tummy you can
Speaker 1: hear it's munching away there. And when you press its
Speaker 1: back you can hear it roaring. And when you press
Speaker 1: the top of the dino's head and you say something
Speaker 1: like welcome to Dragon Eye Toys, this is the talk
Speaker 1: back Dinoh, welcome to Dragon Eye Toys. And I can
Speaker 1: tell you parents and kids absolutely love it. Cave cells
Speaker 1: to leading retailers around the world. Unlike every other toymaker.
Speaker 1: He has spent a year dealing with surging prices and
Speaker 1: mathsfully disrupted transportation. While he's seeing some signs of stabilization
Speaker 1: in the supply crunch, Cave reckons the spike and costs
Speaker 1: still flowing through to consumers. Everybody's toys, everybody's kettles, everybody's
Speaker 1: whatever they're buying. If it's come from China and it's
Speaker 1: arriving in the last quarter of one and the first
Speaker 1: quarter of two, there's going to be pricing creases anything
Speaker 1: from five to depending on the product. Recent data in
Speaker 1: Asia is pointing to some easing of congestion at the
Speaker 1: region's biggest ports, and economists say and easing energy crunch
Speaker 1: in China will also help supply chains. But Cave is
Speaker 1: looking to Chinese New Year in February as a potential
Speaker 1: circuit breaker for the global supply crunch. That's the time
Speaker 1: of year when China's factories shut down for annual holidays,
Speaker 1: and it's normally associated with a lull in global trade.
Speaker 1: Recent data in Asia is already pointing to some easing
Speaker 1: of congestion at major ports, and economists say an energy
Speaker 1: crunch in China is easy and that will also boost supplying,
Speaker 1: so the supply chain is still difficult. The general feel
Speaker 1: is that Chinese New Year tends to be where everything
Speaker 1: breaks off and we restart everything, and so I think
Speaker 1: a lot of people are thinking maybe end of February
Speaker 1: early March things will change. Still cave cautions, it's not
Speaker 1: just supply chain snags that are hitting toymakers. The strength
Speaker 1: of the yuan and high oil prices could leave an
Speaker 1: impact long after ships are sailing on time. Again, I
Speaker 1: would say over the last eighteen months, we've had from
Speaker 1: the factors between a three and ten twelve percent increase
Speaker 1: over that eighteen months, which we've had to pass on
Speaker 1: to our customers as best we can because we you know,
Speaker 1: in our industry you have to be lean and mean,
Speaker 1: and there isn't that extra margin. And I think the
Speaker 1: buyers out there globally realized that prices will go up.
Speaker 1: The question they're all asking is are they going to
Speaker 1: go up again in two Nobody knows. Logically they shouldn't
Speaker 1: go up next year unless something quite fundamental happens within
Speaker 1: the industry and China. So we're looking to stabilize the
Speaker 1: pricing in two. But obviously, as I say, when we
Speaker 1: reset the market in end of February early March, we'll
Speaker 1: get a better indication of where the market is going.
Speaker 1: For now, Santa is going to have to dig a
Speaker 1: little deeper to fill his sleeve. Well, Santa, if you're
Speaker 1: out there, try your best to keep those prices down,
Speaker 1: but unfortunately, I think they're going to be a little
Speaker 1: more expensive than you deliver them last year. Santa for
Speaker 1: Bloomberg News in Hong Kong. I'm end the current now.
Speaker 1: You might have noticed it was a pretty big week
Speaker 1: for Germany, with Angela Merkel stepping down as chancellor and
Speaker 1: a new traffic light coalition taking over under Chancellor Schultz,
Speaker 1: the Social Democrat leader who's featured on this podcast not
Speaker 1: so long ago. So our Berlin producer Aggie Cantrill is
Speaker 1: at the German Parliament and I think could campaint the
Speaker 1: scene a bit for us, Aggie, I should say, we're
Speaker 1: talking about an hour after the official handover of power
Speaker 1: took place in the German Chancery. But it's it's been
Speaker 1: a pretty momentous day. Just tell us what's going on. Yeah,
Speaker 1: highest Japanese, So it has been quite a long day
Speaker 1: really in the in the Bundestag because firstly the Bundestag
Speaker 1: has to officially vote in the new chancellor, which they
Speaker 1: did um with he gained a majority, I believe of
Speaker 1: three and nine round about um. But then after that
Speaker 1: he was sworn in as Chancellor along within you roster
Speaker 1: of ministers, ministers that come from the Greens, the SPD
Speaker 1: and the Liberal Free Democrats, and then he went to
Speaker 1: meet Merkel at the Chantrey and have the official hand
Speaker 1: over this afternoon. And it's the coalition you just described
Speaker 1: it briefly, but it's it's been known as the traffic
Speaker 1: Light Coalition, which sounds very exciting, but just talk us through.
Speaker 1: So the traffic Light Coalition, I mean, it gets its
Speaker 1: name from the colors of the parties, as do all
Speaker 1: the coalitions. And thankfully this isn't one with clumsily named
Speaker 1: flag as many of the other coalitions are named. But
Speaker 1: this one is a coalition of the SPD that represents
Speaker 1: the red, the Social Democrats, the Greens that are obviously
Speaker 1: as their name would suggest, and the Liberals that are
Speaker 1: classically a yellow color. And there is a bit of
Speaker 1: a distance, especially between the Greens and between the FDP
Speaker 1: on it. A few issues when it comes to economic
Speaker 1: and fiscal policy, especially the Greens were always seen as
Speaker 1: these big spenders, all of these party that had questioned
Speaker 1: the merits of things like Germany's constitutional debt break, and
Speaker 1: yet now because of the compromises reached during the coalition agreement,
Speaker 1: we actually see probably a more fiscally conservative government than
Speaker 1: we would have expected if it were just, for instance,
Speaker 1: the Greens and the SPD, because there's a moderating force
Speaker 1: of the FDP that now are in charge of the
Speaker 1: finance ministry. And later on I think we're going to
Speaker 1: get a little bit into how these three parties could
Speaker 1: possibly agree because they sound very different. But one of
Speaker 1: the one of the striking points to come out of
Speaker 1: the coalition agreement that I think court people's eye outside
Speaker 1: Germany was the lowering of the voting age to sixteen.
Speaker 1: And that was I gather that was in a responsive
Speaker 1: part to a big grassroots movement. How did that happen?
Speaker 1: I think something that's really notable about that lowering of
Speaker 1: the voting age is it's something that actually appeals also
Speaker 1: to those parties. Specifically, the Greens and the FDP have
Speaker 1: a very strong support with among younger Germans. And I
Speaker 1: think there's an interesting conversation to be had about whether
Speaker 1: or not it's not a question of the c DU
Speaker 1: and the SPD losing out over all, but the fact
Speaker 1: that they're losing dominance within younger voters, and those voters
Speaker 1: are looking for a sort of alternative to the left
Speaker 1: right or progressive conservative dichotomy, but within two other parties,
Speaker 1: a party, one party that stands for digitalization and modernization,
Speaker 1: and another party that stands for a lot of progressive
Speaker 1: social issues and environmental policy. That's the Greens. Yes, that
Speaker 1: would be the Green. It's been quite low key though,
Speaker 1: or maybe it's just that I'm not sitting in Germany,
Speaker 1: but Angle and Michael has been around for sixteen years,
Speaker 1: has been this momentous figure. I mean, as it is,
Speaker 1: it just not a big deal this week because you've
Speaker 1: had you feel like you've been saying goodbye to her
Speaker 1: for at least a year. I actually think it has
Speaker 1: been quite a big deal. But I think the real
Speaker 1: momentous occasion was the election itself, which of course happened
Speaker 1: a couple of months ago now. And I think it's
Speaker 1: because now everyone's been wrapped up in the coalition agreement
Speaker 1: that it's sort of passed them by that this was
Speaker 1: actually Merkle's official last day. I think the real, the
Speaker 1: real drama happened around the around the election itself, and
Speaker 1: of course Merkele's party losing out on another term without
Speaker 1: her in charge. Well, it didn't pass us by on Stephanomics.
Speaker 1: What do you think Angler Mike is going to do now?
Speaker 1: I'm pretty sure she's going to go on a lot
Speaker 1: of hiking trips. That was her present from the chancellery
Speaker 1: staff today. They brought her some some hiking sticks and
Speaker 1: a tind to bring some sandwiches in on her trips,
Speaker 1: and I think she's probably going to take up quite
Speaker 1: a long time sped sped exactly, I can thank you
Speaker 1: very much, but I'm joined now by Holger Schmiding, chief
Speaker 1: economist for Behrenburg Bank and a wise observer of the
Speaker 1: German and broader European economy for many years. Holger thanks
Speaker 1: very much for joining Stephanomics and Angela Merkel has had
Speaker 1: sixteen years in office, one of the most influential politicians
Speaker 1: of our era by any measure. I don't feel like
Speaker 1: if it was any other country or any other chancellor,
Speaker 1: we'd be making much more fast about her departure. Now, Well, indeed,
Speaker 1: what we are seeing is a very smooth condition of
Speaker 1: power in Berlin, and it really does mark the end
Speaker 1: of an era. But it does not mark a major
Speaker 1: change in policies. And that's probably why there is only
Speaker 1: limited excitement about it. We'll get it, we'll get onto
Speaker 1: that the new government in a minute. And I think
Speaker 1: in any other country would seen more exciting. I know
Speaker 1: you're you're gonna carefully explain to us why we shouldn't
Speaker 1: be too excited. But if you think about when the
Speaker 1: history books have written, what are the main contributions that
Speaker 1: you think a Glamrker will be remembered for, she will
Speaker 1: not be remembered for one single contribution. She will probably
Speaker 1: be remembered most for two things. First of all, she
Speaker 1: presided over one of the best periods you could say,
Speaker 1: in German history, sixteen years of stability, of peace and prosperity,
Speaker 1: with a record rise in employment. The number of jobs
Speaker 1: where you earn enough who have to pay part payroll
Speaker 1: taxes on her watch rose by in a population that
Speaker 1: did not increase very much. So that is indeed one thing.
Speaker 1: The other thing is, of course her very contentious decision
Speaker 1: during the refugee crisis to not close Germany's borders again
Speaker 1: after the first rush of refugees from Hungary had been
Speaker 1: led in, and the subsequent webs and the subsequent wave
Speaker 1: of migrants, of course did sharpen and exacerbate divides in
Speaker 1: the country. In Europe, it probably contributed a bit to
Speaker 1: the British debate about Brexit. So that is one thing,
Speaker 1: the refugee crisis and are dealing with it, that she
Speaker 1: may be remembered for. But let's put that into contact.
Speaker 1: On the European level, she after some deliberation, did a
Speaker 1: lot to keep the EU, the Eurozone together as well
Speaker 1: as she could. She kept Greece in the Europe, overruling
Speaker 1: her own finance minister on that matter when she really
Speaker 1: had to. She put a lot of German money on
Speaker 1: the table during the pandemic to support heavily affected countries
Speaker 1: during the euro crisis. So she was in one sense
Speaker 1: a very strong European despite the controversies she triggered during
Speaker 1: and in the aftermath of the refugee crisis. I mean,
Speaker 1: you mentioned the refugee crisis. I suspect that was a
Speaker 1: time when Angela Merkel as a as an individual politician,
Speaker 1: really crossed people's radars outside of Europe because you had
Speaker 1: those pictures coming from the German train stations and the borders,
Speaker 1: and then her speech effectively saying to open the borders
Speaker 1: and that that anyone could come in. I mean, that
Speaker 1: was that was quite a moment at the time. What
Speaker 1: was the more long term impact on the political scene
Speaker 1: of that whole crisis on the German political scene, that crisis,
Speaker 1: the discussion about many, many migrants coming in, did revive
Speaker 1: the fortunes of the flagging far right a f E party,
Speaker 1: which now is a presence in the German Parliament with
Speaker 1: a good ten percent of the vote. It had been
Speaker 1: scoring below five before the refugee crisis. So it did
Speaker 1: sharpen the political debate in Europe in Germany and did
Speaker 1: add to support for right wing far right parties. Having
Speaker 1: said that, first of all, her big decision to let
Speaker 1: in refugees from Hungary was widely applauded across the political spectrum.
Speaker 1: It was her subsequent hesitation about closing the border again,
Speaker 1: her refusal coming from East Germany having been hemmed in
Speaker 1: by a wall for much of her life, while Germany
Speaker 1: was divided and she was on the wrong side of
Speaker 1: the war her refusal to erect a wall at the
Speaker 1: German borders figuratively speaking, that is, to strongly police the
Speaker 1: borders against migration. That refusal in the end proved to
Speaker 1: be quite controversial. She is still hugely popular today. Yes,
Speaker 1: she leaves office as the most popular policymaker in Germany,
Speaker 1: a position she has held through most of her time.
Speaker 1: With some ups and downs, you could say she leaves
Speaker 1: very much on a high note. And when it comes
Speaker 1: to the refugee segation, what we also have to say now,
Speaker 1: with six years having passed since the integration within Germany
Speaker 1: is not proceeding too badly. So the verdict is open
Speaker 1: whether in the longer term net net the problem sharpening
Speaker 1: divisions within the country or the benefit a country with
Speaker 1: an adverse demographic actually gets young people. Most of them
Speaker 1: are eager to work whether this net net will be
Speaker 1: a positive or a negative longer term. Simply, the verdict
Speaker 1: is not out yet. Certainly, from the outside, Germany seems
Speaker 1: to have been despite and maybe, as you say, perhaps
Speaker 1: in part because of the way immigrants have been able
Speaker 1: to be integrated in the labor force. But despite all
Speaker 1: those debates around the refugee crisis, Germany seems to have
Speaker 1: been largely spared the kind of extreme polarization and the
Speaker 1: toxic politics that we've seen, certainly in the UK and
Speaker 1: the US over the last few years. Is that is
Speaker 1: that right or is that just wishful thinking? That is
Speaker 1: absolutely right. Germany has been spared much of the um
Speaker 1: ooxification of politics that we see elsewhere. We have traces
Speaker 1: of it, but not to the extent that you see
Speaker 1: in many other countries. One reason for that is, of
Speaker 1: course history, having had far too much of a polarization
Speaker 1: of society in the ninet twenties and early thirties, and
Speaker 1: we all know the terrible consequences of that, Germans shy
Speaker 1: away from taking extreme positions. On top of that, the
Speaker 1: German constitution, the federal nature of it, de facto enforces
Speaker 1: a kind of consensus. Yeah. The government of Angla Merkel
Speaker 1: for three of her third terms included, apart from her
Speaker 1: center right Conservatives, the center left social Democrats, which meant
Speaker 1: that compromises between the two big strands of political thought,
Speaker 1: the center right and the center left, had to be
Speaker 1: struck within the government and also the strong role of
Speaker 1: the Constitutional Court and the upper house of Parliament, where
Speaker 1: typically the party that is in opposition in the federal
Speaker 1: government has a veto the fact to enforces that mainstream
Speaker 1: parties have to talk to each other and come up
Speaker 1: with a joint view. And as a result, Germany rarely
Speaker 1: does big policy shifts which do not enjoy broad political
Speaker 1: support across the isle. So you do have i mean
Speaker 1: on paper, just turning to the new government that we
Speaker 1: have that that takes power this week. Um, it's as
Speaker 1: you said, it's the Social Democratic Party along with the
Speaker 1: Free Democratic Party and the Greens, which in any as
Speaker 1: you said yourself, it's sort of crosses the political spectrum
Speaker 1: in Germany. In any other country, it would sound pretty
Speaker 1: difficult to manage, is it. Is it going to be
Speaker 1: an unworkable coalition at first? It may sound unworkable. I
Speaker 1: mean you have to imagine in the US as if
Speaker 1: sort of the Democrats were to cooperate with of the
Speaker 1: Republicans for one government within one government, that's roughly what
Speaker 1: we are. Biden can only dream of having that exactly,
Speaker 1: get the Democrats to cooperate with exactly, so, at least
Speaker 1: in Germany, we have seen that these three different parties
Speaker 1: have come up with a joint program to govern. Germany
Speaker 1: has a long tradition, at least a long postwar tradition
Speaker 1: of such coalition governments, which against threddled the political divide
Speaker 1: for us. This is normal that you try that you
Speaker 1: campaign on your own platform, but you basically know that
Speaker 1: once it comes to governing, you are not implementing your
Speaker 1: own manifesto. You are trying to combine your manifesto with
Speaker 1: that of your coalition partners of a different persuasion, and
Speaker 1: probably it will work simply because in this government the
Speaker 1: three parties have granted each other a bit of leeway
Speaker 1: when it comes to social policy, such as hiking the
Speaker 1: minimum wage. It is not a compromise. The social Democrats
Speaker 1: the center left have said we want the minimum wage
Speaker 1: twelve euros per hour. They get it. The Greens have
Speaker 1: said we want a faster exit from code, they get it.
Speaker 1: The Liberals have said no tax hikes to fund all
Speaker 1: of that, and they get it, which of course means
Speaker 1: we need a few tricks to actually fund the expert
Speaker 1: investment spending. But it's not just a compromise that is
Speaker 1: all murky. It is something where all of the three
Speaker 1: parties can say the government's programs it does bear to
Speaker 1: some extent our imprint. Hence we can and could sell
Speaker 1: it to our members. So events always happen. If it
Speaker 1: is never easy in government, stuff will happen. There will
Speaker 1: be discord, But I do think this government is as
Speaker 1: likely to be stable as previous German governments and full
Speaker 1: of super reasonable politicians who don't do any of the
Speaker 1: things that other politicians and other countries seem to do.
Speaker 1: When we think about the big challenges for the country obviously,
Speaker 1: and the environmental is one, the energy transition. People for
Speaker 1: a long time, particularly economists who are not German, have
Speaker 1: criticized Germany for being too dependent on its export sector
Speaker 1: and heavily reliant on that on that sort of manufacturing
Speaker 1: side of the economy, which has remained so much stronger
Speaker 1: than it is in many other European countries. I'm interested
Speaker 1: given the current climate concerns about US and China relations
Speaker 1: affecting um the integration of the global economy, and the
Speaker 1: now right now the supply chain issues that we're seeing,
Speaker 1: how has Germany been affected by that? The current supply
Speaker 1: chain is affect Germany a lot. What we are seeing
Speaker 1: is very subdued output in the car sector, say at
Speaker 1: least below what German companies could produce and what they
Speaker 1: could sell given that order books are full. So Germany's
Speaker 1: very dependence on manufacturing, which requires a lot of inputs,
Speaker 1: including semi conductors, forcast, for machine too its is now
Speaker 1: in the near term the significant weakness. It is one
Speaker 1: major reason why Germany in the recovery from the pandemic,
Speaker 1: is now lagging far behind or not just a little
Speaker 1: behind France. Having said that this is probably an issue
Speaker 1: that will no longer be that relevant, say two years
Speaker 1: from now, my private guess is that two years from now,
Speaker 1: with almost every government subsidizing seemi conductor production, we may
Speaker 1: have a glut or at least sufficient, if not too
Speaker 1: many seemi conductors. What we can say if we look
Speaker 1: back at the last twenty years. But all in all,
Speaker 1: Germany's focus on top not manufacturing has not served the
Speaker 1: country badly and it hasn't paid to bet against Germany
Speaker 1: in the last few decades. People, certainly in Britain and
Speaker 1: the UK in the US are a bit worried about
Speaker 1: getting their toys in time for Christmas. With all these
Speaker 1: supply chain issues are you Are you nervous of people
Speaker 1: in Germany nervous about that rushing out to get your
Speaker 1: toys early. Supply chain issues are a major problem in Germany,
Speaker 1: but they are more a problem on the production site
Speaker 1: affecting the car industry. There is much less talk than
Speaker 1: some other countries about the delivery problem, that is, getting
Speaker 1: that what arrives in the ports by truck towards the shops.
Speaker 1: There is a bit of anxiety here and there are
Speaker 1: people are being encouraged to buy their toys early, but
Speaker 1: at the moment this does not seem to be a
Speaker 1: big issue. One reason for that is probably that Germany
Speaker 1: is wide open with its land borders, so even if
Speaker 1: truck drivers asking us in part of the country, they
Speaker 1: could come from other part of the country, or more precisely,
Speaker 1: they could come from Poland from Romania. This is a
Speaker 1: pan continental European logistics market which is strained, but which
Speaker 1: does not seem to be anywhere near breaking point where
Speaker 1: you would have to fear that Santa Claus would not
Speaker 1: be bringing what the kids would love. And thank goodness
Speaker 1: for that Oldish Median, thank you very much, You're welcome.
Speaker 1: The pandemic has been a golden age for billionaire wealth.
Speaker 1: You might have suspected that to be true looking at
Speaker 1: stock markets and property prices soaring around the world, even
Speaker 1: when we were in the midst of the COVID slump.
Speaker 1: But now we have some hard numbers to prove it.
Speaker 1: Courtesy of the Global Inequality Lab, the research group established
Speaker 1: by the French economist Thomas Picketty. US economy reporter Augusta
Speaker 1: Surreva wrote up the story for US and is here
Speaker 1: for a quick chat about it. Augusta, thanks for joining us.
Speaker 1: What are the most eye popping numbers in this report?
Speaker 1: Thank you so much for having me. I think the
Speaker 1: most surprising thing of the studies not that billionaires have
Speaker 1: lots of money and control lots of wealth, right, but
Speaker 1: it's the fact that during the pandemic, that's when they
Speaker 1: gained the most wealth. So last year, for example, they
Speaker 1: saw billionaire wealth reached three point five percent from simply
Speaker 1: one percent when they started tracking these numbers. So it's
Speaker 1: been going up three point five percent of the world's
Speaker 1: wealth exactly. And that's only and that's fewer than three
Speaker 1: thousand people. Yes, that's controlled by about two thousand and
Speaker 1: seven and seven hundred and fifty people and nowadays they
Speaker 1: control three point five percent of the world's wealth. And
Speaker 1: at the same time, the poorest half of the global
Speaker 1: population controls only two percent of the global wealth. It's crazy.
Speaker 1: And what of the fact is that the driving the
Speaker 1: increased during the pandemic, because obviously we did have a
Speaker 1: recession in many countries, but we did see stock markets
Speaker 1: go up, I guess yes. And what we happened was
Speaker 1: also that we saw the rich get rereacher and the
Speaker 1: poor get poorer, right, so at the same time that
Speaker 1: we saw a lot of people going into extreme poverty. So,
Speaker 1: for example, one of the one of the numbers that
Speaker 1: the authors of the report mentioned to me when we
Speaker 1: spoke this week is that the World Bank estimates that
Speaker 1: a hundred million people are now living in extreme poverty
Speaker 1: since the beginning of the pandemic, at the same time
Speaker 1: that we've seen billionaire wealth sort right. So this is
Speaker 1: happening at a moment in which, as you mentioned, we're
Speaker 1: seeing both financial and real estate markets sore. Uh, and
Speaker 1: we're seeing a lot of people on the bottom half
Speaker 1: of the income distribution suffer a lot from the lack
Speaker 1: the lack of income during the pandemic, the lack of benefits,
Speaker 1: and this is a trend worldwide. Yeah, lack of benefits,
Speaker 1: lack of vaccine, and I could I also noticed in
Speaker 1: the report that the over over globally, the richest ten
Speaker 1: percent control maybe sixty of the wealth, but there is
Speaker 1: there are quite big distinctions across regions. So are the
Speaker 1: one of the most unequal places in the world. Yes,
Speaker 1: So some of the most unequal places in the world
Speaker 1: nowadays are of course the Middle East and North Africa,
Speaker 1: Latin America, and of course Russia and Central Asia. These
Speaker 1: are places where, of course you doubt in the past,
Speaker 1: with a lot of inequality. So this is not something new,
Speaker 1: But what the authors of the report are saying is
Speaker 1: that nowadays, what we're seeing is a shift from claudio
Speaker 1: inequalities into market inequalities in these places. Just showcase that.
Speaker 1: And I mean, the other thing that I guess was
Speaker 1: distinctive about this report is they talk about not just
Speaker 1: the wealth gap, but also the carbon footprint gap. The
Speaker 1: fact that the wealthier people, although they might talk a
Speaker 1: good game about helping the environment, actually have a much
Speaker 1: much bigger footprint carbon footprint. Yes, and what's surprising about
Speaker 1: that is some of the some of the highest inequalities
Speaker 1: are actually seen in some of the richest parts of
Speaker 1: the of the world. So for example, one of the
Speaker 1: regions where are you see, uh, some of the most
Speaker 1: striking inequalities when it comes to the carbon footprint is
Speaker 1: North America, where the top ten percent of the population
Speaker 1: emits on average seventy three metric times per capita each year,
Speaker 1: compared to last than ten times for the worst half
Speaker 1: of the population in North America. And that that is
Speaker 1: interesting with it within the country. And I found out
Speaker 1: thinking August, I mean when we've we've obviously talked about
Speaker 1: inequality before on this show, and that lots of people
Speaker 1: talk about it, and we've interviewed Thomas Picketty himself for Stephanomics,
Speaker 1: And there was this feeling in the midst of the pandemic,
Speaker 1: as it became clear that inequality was being exacerbated by
Speaker 1: the crisis, that there was going to be this great
Speaker 1: move political appetite post pandemic to tackle inequalities or at
Speaker 1: least start to reduce wealth inequalities in many countries. Do
Speaker 1: you feel like that that's panning out? Do you see
Speaker 1: any appetite for that, I mean, I'm thinking about some
Speaker 1: of the debates we've seen in Congress in the US,
Speaker 1: for example. Yes, it was definitely part of the conversation
Speaker 1: in the US for a long time. We saw Treasury
Speaker 1: Secretary Janet Yellen talk multiple times about it. Aldis not
Speaker 1: only has to end this race to the bottom when
Speaker 1: it comes to taxes, but also play a leadership part
Speaker 1: in that. But of course, right now we have many
Speaker 1: conversations happening at the same time on the policy brought right,
Speaker 1: and we're talking about infrastructure bill, we're talking about taxes,
Speaker 1: we're talking about building back better, and of course there's
Speaker 1: this whole conversation seems to be penning out a bit.
Speaker 1: I think that's also it's interesting in the in the
Speaker 1: UK there seems to be no appetite for that kind
Speaker 1: of action at all. And if anything, on the margins,
Speaker 1: the the extra spending and the tax changes have tended
Speaker 1: to benefit and high income people more. It's all interesting. Well,
Speaker 1: Gustus soever, thank you very much, thank you for having me. Well,
Speaker 1: that's it for this episode of Stephonomics. We'll be back
Speaker 1: next week. In the meantime, if you like the program,
Speaker 1: please take the time to rate it and follow as
Speaker 1: Economics on Twitter for more news and analysis from Bloomberg Economics.
Speaker 1: This episode was produced by Magnus Hendrickson, with special thanks
Speaker 1: to Ender Current, Augusta Serreva, Aggie Cantrill, and Holger Schmiding.
Speaker 1: Mike Sasso is executive producer of Stephanomics and the head
Speaker 1: of Bloombird podcast is Francesco Leafy h