<HTML><BODY style="word-wrap: break-word; -khtml-nbsp-mode: space; -khtml-line-break: after-white-space; "><BR><DIV><DIV>On May 1, 2006, at 10:14 PM, Claudio wrote:</DIV><BR class="Apple-interchange-newline"><BLOCKQUOTE type="cite"><SPAN class="Apple-style-span" style="border-collapse: separate; border-spacing: 0px 0px; color: rgb(0, 0, 0); font-family: Helvetica; font-size: 14px; font-style: normal; font-variant: normal; font-weight: normal; letter-spacing: normal; line-height: normal; text-align: auto; -khtml-text-decorations-in-effect: none; text-indent: 0px; -apple-text-size-adjust: auto; text-transform: none; orphans: 2; white-space: normal; widows: 2; word-spacing: 0px; "><DIV><FONT face="Arial" size="2"><SPAN class="Apple-style-span" style="font-family: Arial; font-size: 11px; "></SPAN><DIV style="margin-top: 0in; margin-right: 0in; margin-bottom: 0pt; margin-left: 0in; font-family: Arial; font-size: 11px; "><SPAN style="FONT-SIZE: 14pt; font-family: Arial; font-size: 18.6667px; "><FONT face="Times New Roman"><SPAN class="Apple-style-span" style="font-family: Times New Roman; font-size: 18.6667px; "> the World Development Report 2006 (WB, 2006) makes a remarkable statement. It says that </SPAN><B style="mso-bidi-font-weight: normal; font-family: Times New Roman; font-size: 18.6667px; font-weight: bold; "><SPAN class="Apple-style-span" style="font-family: Times New Roman; font-size: 18.6667px; font-weight: bold; ">economic inequality results from unfair power structures and political influence and an absence of corrective measures of market failures</SPAN></B><SPAN class="Apple-style-span" style="font-family: Times New Roman; font-size: 18.6667px; ">.</SPAN><SPAN style="mso-spacerun: yes; font-family: Times New Roman; font-size: 18.6667px; "><SPAN class="Apple-style-span" style="font-family: Times New Roman; font-size: 18.6667px; "> <BR></SPAN></SPAN></FONT></SPAN></DIV></FONT></DIV></SPAN></BLOCKQUOTE><DIV><BR class="khtml-block-placeholder"></DIV><DIV><BR class="khtml-block-placeholder"></DIV><DIV>This is remarkable not only because the World Bank fails to propose remedies, but, more fundamentally, it is remarkable because it fails to recognize the way in which free markets necessarily and inescapably produce economic inequality. Permit me to quote from p. 19 of my book, Children in the International Political Economy:</DIV><DIV><BR class="khtml-block-placeholder"></DIV><DIV>"The ordinary, normal working of the market system creates wealth, but it also leads to poverty, and thus to concentration and to steadily widening gaps. The way in which the market system concentrates wealth and power in the hands of some and impoverishes others is very straightforward. The elementary transaction of the market system is the bargain, the negotiated exchange. One's bargaining strength depends on the quality of one's alternatives. Some people (or companies, or nations) are stronger than others because they have better options.</DIV><DIV><BR class="khtml-block-placeholder"></DIV><DIV>Those who have greater bargaining strength tend to gain more out of each transaction than those who have lesser bargaining strength. Thus, over repeated transactions, stronger parties systematically enlarge their advantages over weaker parties. Bargainers do not move to an equilibrium at which the benefits are equally distributed, but instead move apart, with the gap between them steadily widening. Asymmetrical exchange feeds on itself, making the situaiton more and more asymmetrical."</DIV><DIV><BR class="khtml-block-placeholder"></DIV><DIV>No wonder it is the rich who are the strongest advocates of "free" markets.</DIV><DIV><BR class="khtml-block-placeholder"></DIV><DIV>Aloha, George</DIV></DIV><DIV><P style="margin: 0.0px 0.0px 0.0px 0.0px; min-height: 14.0px"><BR></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">+++++++++++++++++++++++++++++++++++++++++++++++++++</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Professor George Kent</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Department of Political Science</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">University of Hawai'i</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Honolulu, Hawai'i 96822</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">USA</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px; font: 12.0px Helvetica; min-height: 14.0px"><BR></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Phone:<SPAN class="Apple-converted-space"> </SPAN>1 808 396-9422</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Cell: <SPAN class="Apple-converted-space"> </SPAN>1 808 389-9422</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Fax:<SPAN class="Apple-converted-space"> </SPAN>1 808 956-6877</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Email: <SPAN class="Apple-converted-space"> </SPAN><A href="mailto:kent@hawaii.edu">kent@hawaii.edu</A></FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Website: <SPAN class="Apple-converted-space"> </SPAN><A href="http://www2.hawaii.edu/~kent">http://www2.hawaii.edu/~kent</A></FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">Skype ID: geokent</FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px; font: 12.0px Helvetica; min-height: 14.0px"><BR></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica">New book: <I>Freedom from Want: The Human Right to Adequate Food</I></FONT></P> <P style="margin: 0.0px 0.0px 0.0px 0.0px"><FONT face="Helvetica" size="3" style="font: 12.0px Helvetica"><A href="http://press.georgetown.edu/detail.html?id=1589010566">http://press.georgetown.edu/detail.html?id=1589010566</A></FONT></P> <BR class="Apple-interchange-newline"> </DIV><BR></BODY></HTML>