China cranks out new tycoons, Africa suffers, and Filipinos seek a dividend
New riches benefit only a few so some islanders discuss economic justice
| We condense two 2007 articles and one web discussion: “China has bumper crop of billionaires” by David Barboza of the Oregonian (Nov 18); “World's Poorest 'Being Left Behind'” by the International Food Policy Research Institute (Nov 8); and “All Filipino Citizens Must Demand Their Economic Rights” at PHILIPPINEPOLITICS.NET, a text lifted largely from a talk this editor presented at the World Social Forum in Brazil. |
by Jeffery J. Smith
November, 2007
The United States has more billionaires than any other country: 415 by the last count of Forbes magazine. No. 2, and closing fast? China. A year ago, there were 15 billionaires in China. Now, there are at least 66, maybe more than 100.
China's new billionaires are building their staggering wealth on the backs of the richest companies you have never heard of. Chinese private and state-owned companies issuing stock for the first time are becoming the most valuable companies in the world -- sometimes overnight.
The first day the state-owned energy company PetroChina listed shares on the Shanghai Stock Exchange, its market valuation ran up to more than $1 trillion, topping that of any company in history. However, huge amounts of its shares held by the government are untradable. But on paper, at least, it has dethroned Exxon Mobil as the most valuable company in the world.
Similarly, China Mobile is the world's most valuable telecommunications company. The state-owned Industrial and Commercial Bank of China, a commercial bank that was nearly insolvent a decade ago, is worth more than Citigroup. And when Country Garden, a southern China real estate company, went public in April, its initial public offering was bigger than Google's.
JJS: As Henry George noted over a century ago, where there’s progress there’s poverty. Per capita income in China is less than $1,000 a year.
IFPRI: The world's poorest people, 162 million of them, survive on less than 50 cents a day. About one billion people live on less than a dollar a day. Most of them are struggling to survive in Africa.
East Asia and the Pacific lifted many people out of poverty, including the poorest. In South Asia, many people have climbed above 50 cents a day while those living close to a dollar-a-day fared much better. However, ultra poverty rates have fallen only minimally in Sub-Saharan Africa, home to three-quarters of the world's poorest people.
Despite a global trend of poverty shifting toward urban centers, poverty rates are at least twice as high in rural areas, and the ultra poor are nearly four times more likely to live in rural areas than in urban areas.
The poorest people typically belong to socially excluded groups that live in remote rural areas with little access to roads, markets, education, and health services. Households living in ultra poverty are on average four times less likely to have electricity than households living above the dollar-a-day line.
Three common poverty traps are inability of poor families to invest in the education of their children, limited access to credit for those with few assets, and reduced productivity due to malnutrition.
PHILIPPINEPOLITICS.NET: Filipinos live in one of the most resource-rich countries in the world and yet are destitute since they don’t benefit from their resources.
Redistribution of land is not going to solve the problem of rich-poor gap. It'll make life more bloody and inhospitable for everyone. The communists enforce land distribution when all they have to do is impose land valuation taxation.
A current market value of just Philippine mineral resources is estimated at $1 trillion. Combine actual land values that include rural and urban areas; that’s more than enough revenue for Government to issue a Filipino Citizens’ Dividend (FCD) from all the natural resource rents. All Filipinos could potentially receive an FCD in the amount of about PhP15,000 a month.
Filipinos must demand that this FCD be formulated into law. Filipinos would do more to weaken the corporate elite than almost any other strategy imaginable. Because this strategy is so subtle, it remains a secret -- and its advocates remain safe. But it's a potent reform.
Politically, sharing rent would create a world of equals. Economically, sharing rent would lift people out of poverty and motivate people to conserve the environment. This FCD lets Filipinos create the community everyone wants. Replacing taxes with land dues and subsidies with rent dividends is the policy of geonomics.
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Jeffery J. Smith runs the Forum on Geonomics.
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Also see: How People Become Billionaires
Poverty in the Midst of Plenty
Manila Eyes Eviction of Poor from Cemetery |
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