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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?

The European Parliamentary Research Service (EPRS) has selected some of its resources to provide young people like you with background information and insights linked to the topic above.

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The European Parliamentary Research Service (EPRS) has selected some of its resources to provide young people like you with background information and insights linked to the topic above.


03 March 2021
I have seen that some of the ideas given relate to taxation.
I agree that we need fair and progressive taxation in order to help those in need, to fund essential services and universal access to health and education.
But I think that it's much more important for us to focus on these next ideas if we really want to tackle growing inequality (seeing that most countries already have progressive taxes, and I completeley disagree with ideas like 99% taxes):

1 - Making sure that taxes are being correctely used and applied to allow that people aren't left behind, by applying it to scholarships, education programs, etc.
2 - To analyse why the social ladder isn't working like it should in different countries/classes/etc and to develop an EU initiative to promote the functioning of the social ladder.
3 - To create opportunities for people to be exposed, learn and specialize on essential skills for Industry 4.0
17 October 2020
Few ideas:

Progressive taxation, integrating the income of the poorest decile of the population and heavy taxation (>60% of the income) to the richest decile and centile of the population.

The same thing should be applied to properties to help a redistribution of capital.

About financial market I think that income derived form financial speculations made in the time interval of one week should be taxed at the 99%, financial speculations made in the time interval of 10 years or more can be taxed at 10% or 5%.

Reduce the political power of big corporations and think about giving much more political power to people with lower income. Today is very difficult to start a political career in Italy.

An other good thing should bi limiting in time the political power of single persons, ten years of political activity is more than enough and political and technical activities should be separated.
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.
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.
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.