Question

What do you think could be done to improve global capital movement to lower US and global inequality?

Answer 1

The rise in global capital flows involving developing countries has led to a corresponding rise in cross-border financial holdings and an expansion in their international investment positions, recording foreign assets and liabilities. The relative rise in developing countries gross foreign assets and liabilities provides further evidence of progressing financial globalization. Increasingly developing countries too are becoming part of globally interconnected balance sheets. In many developing countries, the concomitant rise in foreign assets and liabilities has seen an improvement in their net foreign asset positions, a process mainly driven by improved current account positions (Chart).

And further ways to reduce global inequalities as below

a) Stop Illicit outflows: In developing countries, inadequate resourcing for health, education, sanitation, and investment in the poorest citizens drives extreme inequality. One reason is tax avoidance and other illicit outflows of cash.

b) Progressive Income Tax: After falling for much of the 20^th century, inequality is worsening in rich countries today. The top one percent is not only capturing larger shares of national income, but tax rates on higher income have also dropped.

c) A global wealth Tax

d) Enforce a living wages