Corruption leads to poverty and income inequality

In my last column, I wrote about Oxfam and the concept of income inequality as the major economic problem in the world today.

- ELFREN S. CRUZ

This form of inequality that has led to a few hundred multi-billionaires owning more wealth than the poorer half of the world's population has been the major cause for the rise of populist leaders who preach that it is the existence of an economic elite that is the main cause of income inequality.

In several countries like the Philippines, there has been consistent GDP growth but the poverty rate has remained relatively high. Any increase in economic wealth has only made the rich, richer. The revolt against the economic elite used to be a primary characteristic of poor countries. However, in recent years, even wealthy countries like the US are beginning to rebel against this persistent inequality.

The primary means previously of addressing income inequality was through the political ideology of social democracy. I have written several columns on this topic, which basically advocates retaining a form of capitalism but ensuring state regulation of the free market system.

In the US, a recent ideology that has risen is democratic socialism, which argues that the attempts of social democrats to harness capitalism to a strong welfare state are not enough.