3.6 billion versus eight

One doesn’t have to think or look too hard to release that we live in a time of profound inequalities. While the manifestations of these inequalities are varied, most of them are rooted in the lingering problem of stubborn concentrations of wealth, which refuse to trickle down to the masses. Consequently, eight men in the world today own the same amount of wealth as 3.6 billion poor people.

This above estimation was put forth in a new report, ‘An economy for the 99 per cent’, published by Oxfam earlier this year, to coincide with the annual World Economic Forum, which brings together global and political and business leaders in Davos to talk about improving the state of the world.

Oxfam’s estimates of the glaring inequality which plagues the world was intentionally timed to be released at the time when world leaders are gathered in Davos. Oxfam uses the reputable Credit Suisse Global Wealth Databook, which in turn is based on up-to-date national balance sheet data and household surveys to compile a global wealth distribution. Oxfam also uses a more granular data source which measures the net wealth of the very richest individuals obtained from Forbes billionaires list.

The world today which has made impressive progress in reducing poverty, and wealth creation has also played a major part in this process. However, the continued emphasis on elite-led models of growth have allowed big business and the super-rich to fuel an inequality crisis, which is creating unacceptable levels of wealth concentration. Meanwhile, millions of people in developing countries are still struggling to obtain basic facilities such as clean water, sanitation, health and education facilities. Even in rich countries, blue collar wages are stagnant, while corporate bosses are getting millions of dollars in annual bonuses. Politicians with their myopic visions increasingly pit frustrated workers against migrants and overseas workers, who are even more severely exploited by the existing global production system.

Oxfam estimates that real incomes of the world’s very poorest have gone up by merely $3 a year over the last 25 years. Yet there appears little hope of substantive change, given that GDP growth is still advocated as the prescription to varied forms of deprivation within the developed, and the developing world.

New data on the distribution of global wealth, particularly from India and China, indicates that the poorest half of the world has less wealth than had been previously thought. The situation in Pakistan is no better, even though poverty has evidently fallen in our country over the past decade and a half. Many well-to-do people seem heartened by the Wall Street Journal’s latest assessment that 84 million Pakistanis belong to the middle and upper classes. However, the criteria for being middle class in the Pakistani context is hardly impressive. Moreover, such statistics do not pay sufficient attention to inequality, which is growing markedly despite the fall in poverty.

Available evidence by researchers, and even our official figures, reveal that income distribution has become less equal nationally over the last three decades. Even if the ‘middle class’ has expanded over the last three decades, the income and asset differences between the haves and the have nots is growing, as are regional disparities. This income differential is of course not unique to our country, as the above report illustrates.

In the integrated global political economy, all governments must work together to ensure that all workers are paid a decent wage, and global measures are put in place to stop tax dodging, and the race to the bottom being driven by the compulsion to lure foreign direct investment by multinational corporations. We desperately need to transcend the prevailing market driven principles of elite-led growth, which are not only widening inequality gaps between countries, but also within them, and in turn are exacerbating global instability, violence and the polarisation of societies.

Published in The Express Tribune, March 31^st, 2017.

Like Opinion & Editorial on Facebook, follow @ETOpEd on Twitter to receive all updates on all our daily pieces.