As war on corruption mounts, China’s rich flee to America
HONG KONG — It’s a favorite pastime: Americans worried about their country’s direction love threatening to move abroad. “That’s it, I’m going to Canada!” they say.
Of course, they almost never do.
In China, however, that’s now no idle threat, especially for the rich.
Amid a widening crackdown on corruption, China’s wealthiest citizens are increasingly seeking a better life abroad.
The United States is their favored destination.
That’s the surprising conclusion of a new Hurun Report survey of 393 Chinese millionaires. According to the report, 64 percent of wealthy Chinese (those with $1.6 million or more) have emigrated or are planning to do so. Hurun also found that a third of the super-rich (those with $16 million or more) have established homes elsewhere.
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http://www.globalpost.com/dispatch/news/regions/asia-pacific/china/140131/war-corruption-ramps-china-s-wealthy-flock-america
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The top 1% has seen its real income rise by more than 60% over those two decades. The largest increases however were registered around the median: 80% real increase at the median itself and some 70% around it. It is there, between the 50th and 60th percentile of the global income distribution that we find some 200 million Chinese, 90 million Indians, and about 30 million people each from Indonesia, Brazil and Egypt. These two groups—the global top 1% and the workers of the emerging market economies— are indeed the main winners of globalization...
But the biggest loser (other than the very poorest 5%), or at least the “non-winner,” of globalization were those between the 75th and 90th percentile of the global income distribution whose real income gains were essentially nil. These people, who may be called a global upper-middle class, include many from former Communist countries and Latin America, as well as those citizens of rich countries whose incomes stagnated.
More than fifty percent of one’s income depends on the average income of the country where a person lives or was born (the two things being, for 97% of world population, the same). This gives the importance of the location element today. There are of course other factors that matter for one’s income, from gender and parental education which are, from an individual point of view externally given circumstances, to factors like own education, effort and luck that are not. They all influence our income level. But the remarkable thing is that a very large chunk of our income will be determined by only one variable, citizenship, that we, generally, acquire at birth. It is almost the same as saying, that if I know nothing about any given individual in the world, I can, with a reasonably good confidence, predict her income just from the knowledge of her citizenship... Around 1870, class explained more than 2/3 of global inequality. And now? The proportions have exactly flipped: more than 2/3 of total inequality is due to location.
http://gulzar05.blogspot.com/2013/11/measuring-global-inequality.html
As the author points out the biggest losers were the poorest 5% of the world's population and the middle class in the developed world. The big winners were workers in emerging countries and the global 1%.
While it is encouraging to see much progress in the incomes of previously very poor people (from the poorest 10% up to the poorest 70% or so), the growth of incomes of the 1% needs to be addressed and redistributed to the poorest 5% and the middle class in the developed world.
What a nice trade.
