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Freeland on The self-destruction of the 1 percent:

  • ‘inclusive’ societies (high social mobility) do well – eg, rise of Venice with the formation of colleganza (meaning joint-stock company which financed trade missions)
  • whereas ‘extractive’ societies (rich maintain their privileges to exclusion of others) will fail in long-term – eg, eventual shrinking of Venice after the Serrata (meaning the closure -when colleganza was banned, etc)
  • but the danger of inclusive societies is that they are on track to becoming extractive (those who benefited from inclusiveness and became rich will want to ‘pull up the ladder’ that they climbed)
  • Luigi Zingales: there is a difference between pro-business and pro-market – only the latter is for free competition. Business lobby is only the former.
  • Kuznets’ Curve = upside-down U – as the economy becomes more developed/productive, inequality goes from low (‘as savages we are equals’) to high (during industrialisation some agrarians are left behind) and back down to low inequality (as education of the masses means equal opportunity – eventually should mean wealth equality)
  • in the 1950s, the top tax bracket was >90%
  • 93% of income gains from 2009-10 recovery (after the $700bn bailout) went to top 1% of taxpayers
  • income inequality in the US is higher than at any point in history since the Gilded Age (1860s-1890s)
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