Income inequality has remained high over the years, and this may partly explain the increase in some of the social problems in the country.
The source for this graph said it makes use of income figures obtained from the official Household Income Survey adjusted for inflation using the Consumer Price Index with 1970 as the base year.
How has this income inequality arisen?
Is it an inevitable feature of ‘progress’?
Or is it an unavoidable result of our capitalist model of development that rewards those with Big Capital?
Or more precisely, could it be the outcome of neo-liberal policies (including privatisation) that favour the wealthy, Big Business and well-connected or even corrupt cronies? Notice, the gap between the top 20 per cent and the bottom 40 per cent grew wider after the Mahathir administration embraced privatisation and other neoliberal policies from the late 1980s.
Or is the widening gap the result of the lowering of the tax rate, especially for the wealthy and corporations, while the position of workers has grown weaker?
A significant 40 per cent of households still earn less than RM2300 per month. There are also disparities between Sabah/Sarawak and the peninsula and between rural and urban areas within the peninsula.
Our Gini coefficient (a measure of income inequality) at 0.44 in 2009 is one of the highest in the region, comparable to Singapore’s.
What can we do to narrow this gap and empower those at the bottom of the social heap?