Russia Has Highest Level of Wealth inequality

A new report on global wealth has determined that Russia now has the highest level of wealth inequality in the world–with the exception of a few small Caribbean nations where billionaires have taken up residency.

 

The annual global wealth study published by the financial services group Credit Suisse says a mere 110 Russian citizens now control 35 percent of the total household wealth across the vast country.  By comparison, billionaires worldwide account for just 1 to 2 percent total wealth.

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Most of these fortunes have been made in the last 20 years.  Russia’s richest citizens have made their money by controlling companies in the natural-resource section like gas giant Gazprom, oil companies or metal firms and use their political connections with the Kremlin to maintain their fortunes.  There seems to be more political connections between the billionaires in Russia than there are in other countries.

 

Many reformers had hoped that after the collapse of communism that Russia would evolve into a high-skilled economy with a fair distribution of wealth.  There were efforts early on to ensure that the privatized wealth was distributed.  Obviously, what happened was that there wasn’t really enough safeguards put in place and some people managed to acquire more than their fair share of the privatized assets.

 

There is no such thing as “average” income in Russia.  90% of people make about $5,000 a year.  9% make $40,000-50,000.  Less than one percent makes $100,000+ and there are a few hundred people who make over a billion dollars per year.  According to figures published by the World Bank at the end of last year, 20 percent of the Russian population lives below the poverty line, which is defined as a monthly income of 1,000 rubles (less than 30 euros, or $38).  The great majority of Russian families are teetering on the edge of poverty.  The majority of the poor in Russia are to be found among working families headed by adults with average technical professional training, and in families

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