oriel fellow of international finance at the george washington university in london we have keith pilbeam he is a professor of international economics and finance at city university london and in sofia we crossed the magazine he is a global p.r. expert and chairman of the board at the world communications form in davos all right cross talk rules in effect that means you can jump in anytime you want and i very much encourage shares if i go to you if i can read a short passage from the oxfam report it's quite damning when wealth captures government policy making the rules bend to favor the rich often to the detriment of everyone else the consequences include the erosion of democratic governance the pulling apart of social cohesion and the vanishing of equal opportunities for all unless bold political solutions are instituted to curb the influence of wealth on politics governments will work for the interests of the rich that's a pretty damning paragraph from that report and i'd like to point out to our viewers the whole report sounds that way what's your reaction to that well i don't think anyone who's in this business would find it surprising you know and this is

going on it's no surprise that the pope opened up with his remarks that way he did and that is a rethink and a reset button on how countries develop and grow and specially with large economies like china and india and russia on how to have a fairer way to move forward now that doesn't mean you tax the wealthy and the well to do and people who are doing well but you just have to find a different solution and we need a reset button on this ok keith in london. the whole report is basically says one thing if i put it in a paraphrase it is that the the super rich the super rich the one percent they control politics now on a global basis almost everywhere there are some exceptions but you know once the state is captured by these interests i can't see how you can pry it loose. well of course you can pry it loose but that requires governments to actually enact what people want. so i wouldn't be so pessimistic you know they'll go to election

boxes they decide who's in power and obviously if things do get to extremes then ultimately governments ask populist policies for redistribution will get elected and so the rich do have to be a little bit careful because they interfere too much. you know democracies have a way of rebounding back ok back seaman sophia i don't i don't see the rich being very careful i mean from one thousand nine hundred eighty to two thousand and twelve the richest one percent in america and increase their wealth by one hundred fifty percent they're not being very careful i would say they're quite greedy but as logical because the stock market sort of my better judgment that in specially in the modern technology world i see the things very positive by the way and the only reason for that is that is the existence of social media why because the social media bring to the poor nations the most important which they missed education and

sharing of knowledge on one front on the other hand very soon social media who coached changes. terrific changes over the political systems all over the world because the control over the politicians is much higher over the business plan even so i think the changes to the political system will bring changes in the sharing of the well of the well in the in the world scale and also the public life brought more and more people to give much more money for charity which is also a very positive sign because if you go back into history. just twenty twenty five years ago you'll see the amount of money investing invested in charity currently in two thousand and twelve two thousand and thirteen is triple than twenty years ago so that's a very logical development of the existence of the new one ok here that i'm not

going to i'm going to let none of you off the hook here because it seems like the state is rigged now to protect the the wealthy and make them even more wealthy come on you know every since two thousand and eight you know it's the it's the one percent it's the richest people all over the world that are recovered from the global meltdown of that time and it's the middle classes haven't moved much forward at all in the last thirty years so share is not going to go back to you if if the if the state is captured by these special interests and i disagree with you keep them in london i don't see a big difference between the republicans and the democrats in the united states when it comes to these things whatsoever. so peter i'm not going to disagree with you and checking one thing has to be clear social social media has definitely changed the awareness level of people who are not doing so well and are the bottom end of the social economic ladder but what that has caused instead of a redistribution or of access to wealth has cost social unrest the number one

global risk going into two thousand and fourteen is social unrest and most of it stems from the understanding and awareness about the inequity between the rich and the poor and this is growing in every single country in the world at phenomenal exponential rates. then what needs to be done here because again i mean if we go back to this report when you have the state captured and i'm i'm not you know i'm not going to say i'm familiar with british politics as i am with american but you know you have these are stereo budgets coming out of the u.k. and it's just people are just losing hope people are falling through not cracks produce you know it's getting bigger and bigger what people expected from a middle class life twenty years ago is getting harder and harder to attain for people to today and moving forward. yeah i mean it definitely is a big problem in london i mean you know we do see the middle class is getting very squeeze the even the labor government has picked up on this. because incomes are

not going up as quickly as inflation is going up and so people's real living standards are different forwarding certainly in the middle classes there is a lot of resentment building up in the system there's no doubt about it because the rich of course have done very well out of all these quantitative easing policies i mean after all it's the rich one percent forty percent of the us stock market so you know reflating the stock market very low interest rates printing of money is actually benefit the wealthy i mean so i'm very concerned about the amount of power that the top one percent got because it's far too high i mean you know when your opinion efforts enough to keep the next twenty generations going and they don't have to work one day their whole life so there's no question about it and not just of course the u.s. and the u.k. i mean that's been you know as being minted in china than anywhere else in the world at the moment so it's not just the rich countries that the the rich are doing very well you know the top elite in china are doing rather well as well ok maxine

what what happened to the phrase the public good ok you mentioned charity and i agree with you maybe it's not for just virtuous reasons it's because the state no longer provides services for the poorest among us and charities you know i'm sure you get a tax exemption for it as well so i don't see you can complete virtue there but what happened to the turn of the public good. we should understand the charity is just a temporary solution of the teachers because. who is region who is poor it depends on the country depends on the mentality it doesn't depend on the world that is thinks so very many people on the planet thirteen o two can barack just invest that one billion of charity bill gates is doing a lot of charity trip there from the nations and many other people all over the world but the charity may very hardly bring norwich the people may have very hardly bring. education to the people so it solved the issue was very

temporary and very probably i do believe the changes of the political systems which will be in the next twenty years for sure will bring changes of the business of the economical system and then the charities will be just very small supportive part of the fight against property on the global scale ok shares are what gives. yeah go ahead because what initiatives do rich people have to say i will pay more taxes or our investor not me there is no need it's even fewer and fewer now than work ten years ago go ahead well i agree with you on that but i know on the previous remark with charities charities like bill gates and so forth you have to understand these charities are hitting on the lower end of the scale they're looking after food security water security perhaps even land security by no means is that translate them into middle income or higher income wealth you would talk about sustenance here and so even charities have to rethink what direction

they're moving in but again you know like the speaker just before me mentioned the charity issue is just a temporary issue and i keep saying there needs to be a reset button that report is damning but it's nothing that none of us already know . from before but that reset button is there's no incentive structure built into the nomenclature to do to do something like that it kids you know we just heard about it's our students issues here food. the land security things like that what what happened to the state isn't the state supposed to be doing that i mean these are the basic things you know security and making sure people don't go hungry and i think that should be an obligation of the state i mean why is that turned upside down with the obligation of the state now is to make the rich the rich even richer because that's what is happening right now. well we do worry about you know the state being captured by the elite no one wants to live in a country where the top one percent are also not only got all the wealth but

they've got the power over the people i don't think anyone particularly wants that least of all in the united states and you know to keep it because we've got democratic foundations of our country so we are very concerned about this now the question is is how to the poor get out of the traps there read and that is really does require the state to intervene because the state can redistribute income add to redistribute wealth now the poor what they have to do it by themselves however having said that of course the poor get votes in democratic societies so to some extent they need to exercise those votes and make clear you know via social media or whatever influence they can have you know to get these policies in place what really concerns me though of course is that the wealth can be hidden all right so if i want to tax the wealthy i probably hidden it somewhere but it's very difficult for states in today's global as well to get hold of that so if you're the u.k. government trying to do redistribute wealth you may find it very difficult because

so many offshore companies it's hidden in switzerland the bahamas or wherever and all right difficult for the ok to keep i'm going to jump in here folks we're going to go to a short break and after that short break we'll continue our discussion on income inequality stay with our team. is. on june sixteenth one thousand forty one we had a graduation party at school and the war broke out.

the shops were always full of goods. but in september leningrad was blocked. one day mom went to europe saw that all the shelves were empty. in november they bombed the warehouses with this it was the main storage place for all the food in the city people eating the earth because it had small traces of sugar in it i tried to eat it as well but i couldn't. the third night it was incredibly heavy bombing. it was a direct hit on that very shelter and everyone was buried under me. all of them with a. good

lover tour. was able to build a new most sophisticated robot which all unfortunately doesn't give a darn about anything tunes mission to teach music creation why it should care about humans and. this is why you should care only on the. right to see. the first. and i think that your. on our reporters. on the. wealthy british.

market. come to. find out what's really happening to the global economy with max cons are the no holds barred look at the global financial headlines tune into a report on our. welcome back to cross talk where all things are considered i'm peter lavelle to remind you we're discussing global income inequality. shares and if i go back to you in washington both you and keith of stress the

democratic process here i am again extremely skeptical because you have to pay to play primarily in the united states and and you know if you don't have any money you can't play in the political process the only thing you can do is protest or you know some kind of uprising which no one really wants that there but i don't see the political i see the political process as it is is part of this problem of the rich because you can get the koch brothers and they can fund this tea party and you know bill in reinvent themselves in the next election cycle possibly and it's still the same thing you have to have money to have your voice heard social media isn't enough. so so you're right except for one small thing that has shifted in the aftermath of the financial crisis for the first time in this country since i can remember we're actually having a discussion about the dignity of human life and it was obama who raised this discussion you know many people called him everything from

a communist or socialist but for the first time in this country we are actually having that discussion about the dignity of human life now the europeans are with head of us on this in the european union they're discussing a law that actually talks about the minimum standard of lifestyle not not minimum wages but a minimum lifestyle so again you know i think there is some hope and it's a very incremental slow process that we are actually having a discussion on that issue in this country which before would never would have had it it's very interesting. social having a level of social dignity it's interesting that we're having this discussion now beginning in the united states i know it's more robust in europe but it's kind of a difficult time to have this discussion when you're almost bankrupt your own city crisis you have these amazing debt problems that will take a very long time to pay off and we're talking about it the timing is off in a way because before when we had lots of growth and prosperity that with it was the best time to have this conversation but then again everybody thought everything was

going to just keep getting better and better and better and it's not so we've had we have a a crossroads here. well there's no doubt in europe there's extremes i mean you've had the peaks crisis you know portugal ireland italy greece and spain and there's no doubt that many of the citizens are taken a big hit the other thing that worries me about the euro zone crisis since you mentioned there is also a very very high rates of youth unemployment so there's inequality between the generations i mean you know those born in the fifty's and sixty's they've benefited greatly from house price rise the stock market's going up and the youth of course now paying for their education in the u.k. for the first time at the university level they got very high youth unemployment rates are going to get the same benefits that their parents got and this is this is something that concerns me is that the spell current inequality it's inequality between the generations and this is not just a problem of britain that's happened in many other countries as well and i think

you know ultimately the youth want a better deal it maxine speaking of youth i mean this is a good direction to go i mean you really i'm a baby boomer and i remember you know every generation is going to get more and more wealthy you're going to do better your social standing will increase eccentrics cetera that's coming to a screeching halt in the industrialized world and i absolutely agree that a changing of the generations will bring new ideas and who bring new people who understand the poverty and the division of the soul show of the social means in a completely different way. i really apologize that i will go back to my favorite topic it's a social media but the sharing of knowledge the sharing of understanding how people even the different parts of the world group who bring to a completely new generation which i'm calling generation have of course from facebook that will pay attention not only to their countries because sitting in the

us or in bulgaria even our germany belgium to go wherever it's very easy to find solutions to to try. find photos how to find how to fight with our poverty the big issue is to think globally and to luke how the american people can help the poverty in india or how the european people can have the poverty in africa. or china or whatever so because in our countries which are road to developed countries the fights for against poverty is much easier to think of globally so my understanding is that the people in africa or the people in the poor countries. do get some new knowledge through the social media through the fast communications ok waste of money but you know i agree with you here maybe i mean if you this social media we can turn it upside down here is that if i go to you you can turn it upside down the more you know about how the rich make their money the more it makes you angry and you can see how the election process doesn't benefit you what whatsoever

it's captured ok it's absolutely captured i mean you want to talk about taxing the rich or one or two different percent i mean a lot of people are learning like this system is really broken and it's broken for the vast majority of people and it's not going anywhere i don't care if bill gates gives money to african children ok it's all nice and fine but that's not a change of world view on what's the biggest problem in this world today and that is inequality. so i'm going to come back to the issue you know social media galvanises the youth because they're the ones that use it and they get more and more angry and social unrest is the number one global risk right now what we forget sometimes is the other end of the spectrum in many of the countries and specially developed countries as well and even countries like south korea it's the elderly that are getting hit as well so you've got two ends of the spectrum getting hit with this issue of well the youth which are unemployed and their future looks bleak . in the west and in the in the rest of the world and the elderly that the moment

they start working they get into trouble and as a living longer that becomes even a bigger issue and so we've got two ends of the spectrum that are hurting dramatically once you stop working you know it's a very good point that we just heard there why can't we and i'm clearly myself here why can't we learn to live with less with that b. of a possible solution as well because we've been with the entire history of the industrial revolution in capitalism you know it's bigger and bigger more and more but maybe that it's finally time that we think about if we're going to keep humanity in the same circle in one degree or another that a lot of people going to have to have a lot less and we should all expect to live less in many different materialist ways . i don't really agree with that ok it's a lot of people's living standards is going up even if everything comes and i don't give you a good example you know small phones they've transformed the lives of people in

africa you know i work in london i see people on the troop they've got their smartphone their i pads maybe they're a couple but they've got access to fantastic technology which they can use to transform their lives so i'm not so concerned about that because i think we do get more. nice t.v. these days in london even if you are relatively poor you've got a nice flat screen t.v. not everybody but most of them are you know a lot of the space and a lot of those people go into a lot of those people go into debt to have all those nice things is well ok and the west is exporting that excess awful habit of going in to debt and we see it also coming into developing countries here maxime if i can go to you you know we may be african kids with telephones here but where is the state in all of this ok i mean what is the state's responsibility and i'm looking at the distribution of wealth here are they going to repeat the same mistakes that we see in or are they making the same mistakes there that we've seen in the industrialized world. i don't think

that. the poor countries who follow the mistakes of the rich countries just because again it's a new generation it's a new approach it's a new book the growth is much more transparent and transparency is absolutely key word better distribution of the world i'm pretty sure that very soon a new political system will be brought on the world's agenda and i've even gone think that the people who voted for politico part of this most probably you were so u.k. will be the last countries i think that the people who vote for the. probably tourists for interpreters for people like steve jobs are not to mention bill gates also and many other who are leaders examples for for the. for the voters so this fact may change the distribution of the world very soon because the people who would be on the top of the political let's say from asians or the of the parliament of the

top of the countries where luke had the distribution we could go legal systems in a completely different way shares and i'm going to i'm going to yeah go ahead because you know. leadership was mentioned here i said i want to talk about go ahead. good you know i couldn't disagree more with the last. set of statements the bottom line is there is absolutely no evidence that shows that developing and emerging markets are doing anything different than we are they're doing exactly the same mechanism of growth and we're seeing exactly the same results manifest themselves take china for example they're growing exactly the way the west grew they're creating more credit in the system they're creating more debt in the system the rich are getting richer and the poor are staying poor eight hundred million people live below less than fifteen dollars a day in china and that doesn't seem to be changing it's the number one problem the chinese government has right now now eventually over very very long period of time yes things will change but things are going to get a lot worse before people feel the need to push back so hard that we will see

a reset button ok keith would you like to react to that because you know it seems to me that with the what the rich have done recently the last couple of three decades is that you know they made themselves so comfortable but in the process they're destroying the entire process of where they got their wealth from in the first place the economy's ok once you take you squeeze it so much the separation is so great then you start losing your means to keep to protect your wealth and keep your wealth. well they're very good at protecting their welfare not worried about the rich protecting their welfare rather too good at it and and so you know government still need to look at people as well for those that did need to worry about these sort of into generational dynasties that created today i mean if you're a billionaire as i say this is a real date your business side to get these people are going to be sort of like sitting there at the top of the table telling the vast majority what to do then no one really wants that to happen and i do sort of believe our political processes in

the u.s. and the u.k. and other countries are sufficiently robust but they won't be allowed to do this but of course you know the state that means intervention on quite a big scale because as the lady was saying you know there does need to be a bit of a reset of wealth and the best time of course to tax people is when they die i mean this is actually a many governments are trying to get retired and i like that idea perhaps that when they're dead all right we've run out of time many thanks to my guests today in washington london and in sofia and thanks to our viewers for watching us here darkie see you next time and remember process. is a. and

. gentlemen i guess you all know like. it was going to give you even a few hundred a day come across it honestly i'm going to miss the faces i'm going to soak in the midst of this because we've got people coming in that are littered with criminals people from it who knows where in the world this is the united states i'm very tough by the way you go to sure but i was worried that they may not know why they live on mars you know mars. so we pick up things like and odd turbans prayer rugs so when we know they do they're coming from the middle east it's a concentration camp. concentration camp. we've got it hasn't the

white house is not even one of those closed the fact it was a stranger. one of the new posters common in washington d.c. thank you ali face i think you know. a pleasure to have you with us here on t.v. today i'm sure. i'll pull over my language as well but i will only. react to situations i haven't

read the reports so i'm likely to push the no i will leave them to the state department to comment on your latter point of the monthly so it's if mr kerry has a car is on the docket. they do no more weasel words when you have a direct question be prepared for a change when you have to punch be ready for a battle for the op speech. down the street into costs. secret. mission to teach you. this is why you should.

be much.