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Rich-poor divide: How do we make sure economic growth is inclusive?

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Income inequality in Europe is on the rise. The European debt crisis and the Great Recession added urgency to the need to address inequalities and to respond to the middle-class households that feel left behind. However, the benefits of economic growth after the recession have not affected all equally and income inequalities have risen further.


How can policy-makers best resolve these inequalities?

Should we be addressing globalisation, technological change, skill mismatches or inadequate social and economic policies?

Should we focus on redistributing existing wealth by taxing the rich, rather than relying on philanthropy?

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Anssi Eboreime
04 September 2019

A universal basic income would be an amazing tool to combat rising inequalities. This money must not be newly printed however, to avoid inflation, but must come from cuts into business grants for giant corporations (who do not need such grants), and taxes. We must also revamp existing benefit programs in a way that we can use the UBI to get rid of excess bureaucracy for more savings. Also education in investment for the general populace would go a long way to making everyone in the EU benefit from economic growth and not just the few, as if everyone owns stocks then everyone benefits from economic growth.

Glykeria Stavrou
17 July 2019

Globalization is one of the most important causes of inequalities. People spend money on multinational companies due to the low-cost products they offer, accepting the same time to pay the low-quality price. Thus, the wealth gathering is increased and the inequalities are risen. Philanthropy is an ineffective solution as the rich ,many times, donate amounts of money that come in contrast with their real income. The middle-class need empowerment through a stable source of income, which is the State, and not occasional donations. So, taxing the rich seems to be one of the most effective solutions to blunt inequality.

Yordan Nikolov
23 January 2020

As a Bulgarian living in the UK I am considered wealthy by my Bulgarian counterparts who live in Bulgaria, due to the fact I am economically better-off than most of my relatives, friends and family. I think that an important factor in bridging the classist, socio-economic divisions in the EU is through giving more executive power to EU organisations so that they can purge state-level corruption in countries like Bulgaria, which are a cradle of corruption. This is especially crucial when bright, intelligent, entrepreneurial Bulgarians, for example, are the de jure beneficiaries of EU funding, but they never actually qualify for EU funding through programmes due to the pre-decided outcomes of who is successfully going to work on a project that is sponsored by the EU. Such is the level of corruption. It disadvantages the lower classes the most, as only the rich can qualify for such schemes. Thus, a far more radical EU control should be imposed on who works on what when that "what" is receiving EU capital... It is the only way to deconstruct Bulgarian society's economic inequalities.

Miguel Alonso
12 May 2020

There are multiple solutions and multiple problems. My insight can be pretty basic, but I hope my limited knowledge will help shaping of the debate. Basically, the solution to income inequality is taxation. Tax the rich and found social programs to invest in education, culture, housing... The problem with taxing, as we all know, is the fact that the more taxes you have, the less jobs will be created by the companies, specially the big one as they would just move away from the taxed territory (and go to Switzerland, Andorra, Liechtenstein, China, or who knows where). The solution to tax the companies would be to unite the EU under a common strategy to show strength against countries like the US or China which are taking away our enterprises thanks to a low-tax policy. We need to be more strict with big companies who want to sell and make wins in our territory. No taxes? Easy, then no sales in Europe. Europe is a big center of profits, and we should not have a huge tax policy if we don't want these enterprises to invest somewhere else. By prohibiting the enterprises to give what they must, we will collect more taxes, as we would create more money, and all the inequalities could be softened by the correct founding. Investing in local products/business also helps tackle inequalities at the local level, as you are sure that these small enterprises won't go away as they simply don't have the means and by doing that, you would also help these branches create jobs, again, at the local level and not in some island in the Pacific.