There was much talk just before and during the 2018 World Economic Forum in Davos, Switzerland about the “inequality crisis.” The expression underlines a new level of urgency about the huge and ever-increasing gap between the relatively few, very rich people in the world who possess an inordinate share of its wealth, compared with the much greater mass of people who live and work in extreme and often dangerous poverty. Among them are an estimated 40 million people who live and work in slavery, according to an Oxfam International report released as the world’s economic and political elite began arriving for the Davos gathering in the Swiss, mountain-resort town.
High-profile speakers stood on a stage with a gentle, blue and white backdrop on which these words were writ large many times over: “COMMITTED TO IMPROVING THE STATE OF THE WORLD”
Canada’s well-intentioned, celebrity Prime Minister, Justin Trudeau, was among one of the first world leaders to deliver a keynote address. He warned a do-nothing approach to the “staggering” gap between rich and poor would lead to failure for everyone.
“Too many corporations have single-mindedly put the pursuit of profit before the well-being of workers. All the while, companies avoid taxes and boast record profits with one hand while slashing benefits with the other,” he said, according to several on-line, news media reports.
Trudeau focused much of his speech on the need to improve working conditions for women as one of the key ways to deal with the global wealth gap as well as the gender gap.
It was no coincidence the charitable organization, Oxfam International, dedicated to alleviating poverty, released its 2017 report, Reward Work, not Wealth, the day before the official start of the Davos forum. It received considerable world-wide media attention for a couple of days. But toward the end of the week the focus of attention had clearly shifted to the highly-anticipated arrival of Donald Trump.
Yes, that Donald, the President and Commander-in-Chief of the United States of America, once the world’s greatest democracy, but now in a sudden, steep decline in the incompetent hands of a man with no understanding of basic democratic principles. Better I should be President, on that basis alone. But I’m not a U.S. citizen, let alone a billionaire, though they are becoming more plentiful. That’s on account of a prevailing global economic system that favours the rich.
“Last year saw the biggest increase in billionaires in history, one more every two days,” the Oxfam report says, adding up by the end of last year to a total of 2,043 in the world. Oxfam used data from Forbes and the Credit Suisse Global Wealth datebook for its calculations.
“Billionaires saw their wealth increase by $762 billion in 12 months. This huge increase could have ended global extreme poverty seven times over. 82 percent of all wealth created in the last year went to the top percent, while the bottom 50 percent saw no increase at all.
“Dangerous, poorly paid work for the many is supporting extreme wealth for the few. Women are in the worst work, and almost all the super-rich are men.” Oxfam calls on world governments to “create a more equal society by prioritizing ordinary workers and small-scale food producers instead of the rich and powerful.”
The U.K.-based charity said the “big winners” in the recently booming global economy, especially record-high stock market values, have not been ordinary workers, “but the owners of wealth, or capital. Income from wealth — for example interest payments, share dividends or the rising value of property — has increased far faster than wages. Contrary to the conventional wisdom that everyone benefits from a bullish stock market, there is growing evidence showing significant correlation between growing inequality and a rising stock market.”
Oxfam is calling for less talk and more action “to give people what they want: a more equal world.”
One of the Oxfam concerns that especially caught my eye was the extremely high rate of global youth unemployment.
“Almost 43 percent of the global youth labour force is still either unemployed, or working, but living in poverty,” Oxfam says. “More than 500 million young people are surviving on less than $2 a day. In developing countries, it has been estimated that 260 million young people are not in employment, education or training. This is true for one in three young women.”
I have long maintained that a lack of hope among vulnerable young people in the world, especially, but not only young men, is one of the root causes of serious social problems, including radicalization in all its terrible forms.
John McDonnell, a Labour MP in the U.K., also known as the “Shadow Chancellor” in the Labour opposition shadow cabinet, was also one of the speakers at the Davos forum, for the first time in his case.
He made his views known on the “inequality crisis” beforehand. He warned of a “political and social avalanche” unless global economic rules are rewritten, The Independent reported on-line.
McDonnell said many at the Davos Forum have been “patting themselves on the back” as global economic performance improves. “But they should be worried. In the real world, outside the Davos bubble of Alpine restaurants and chalets, the global economic system that have built isn’t working for billions of people.”
Oxfam calls for, among other things, government regulations to “ensure workers have more bargaining power; that we end tax havens; that monopolies are broken up; and that the financial sector and technological progress benefit the majority. Governments and businesses can both act to ensure that poverty wages, slavery, and precarious and dangerous work are not seen as morally acceptable.
“This will require global cooperation on a far greater scale than today,” Oxfam says, adding, “in today’s political climate this will be very hard to achieve.”
That, to say the least, is an understatement.
As the week-long Davos forum entered its last few days the focus shifted from “improving the state of the world” to the highly-anticipated arrival of Trump. Crowds gathered and jostled for position on balconies. Cell phones and digital cameras were raised to get a photo of the famous celebrity in the historical moment. In a carefully scripted speech on the last day of the forum, dutifully read in his monotone, prompter tone of voice, Trump bragged “America is open for business,” with the stock market booming, and corporate taxes cut.
A good place, in other words, to become a billionaire.
One observer picked up on a fairly obvious note of irony in the “breathlessly-awaited speech” when Trump said, “When people are forgotten the world becomes fractured.”
“That he himself was the fracturer-in-chief must have entered the minds of more than a few in the crowded hall,” commented John Lloyd co-founded the Reuters Institute for the Study of Journalism at the University of Oxford, where he is senior research fellow, in an opinion piece carried by the Reuters news agency.
Lloyd returned to the initial focus of this year’s Davos forum as he noted most of the financial and political participants were advocates of globalization, and Trump an exception.
“Trump’s approach has fazed foreign political and business leaders and called into question some of the fundamentals of the Western world’s post-war assumptions – not least, that the United States was on the globalizers’ side,” he wrote.
Whatever else the world might think and say about Trump, there’s surely widespread agreement he tapped into a visceral anger and discontent among a large segment of American voters who feel victimized and left behind by socio-economic changes taking places in the world as a result of globalization.
“Every democratic leader must now be consumed with fear of a revolt, seeking policies which address that discontent and calms it,” Lloyd said.
Surely though, if anything is ever done about the “inequality crisis,” it should be motivated not just by fear, but mostly because it’s the right, and smart, thing to do.
A version of this post was originally published in The Sun Times in January, 2018
This post was to some modest extent I’m sure inspired by the daily prompt silhouette, a dark object against a bright background.