by Gary Berg-Cross (WASH Board Member)
The super wealthy are meeting in Davos again and as one context Oxfam notes that the wealth gap widening. This is not a new topic for Oxfam but this year they observe that around the world wealth inequality is what they call "out of control." They observe that it is doing particular harm to women and provide a report with these stats:
“billionaire fortunes increased by 12 percent last year—the equivalent of $2.5 billion a day—while the 3.8 billion people who make up the world's poorest half saw their wealth decline by 11 percent. “
So while we live in what seems a productive time all around us there is also failure (like students learning less), along with but expensive new things like American medicine and its drugs that more people are being shut out from. Sure there has been a tremendous amount of innovation over the last 40 years but still there are stats that show that half of Americans, the bottom half of Americans, 117 million Americans, literally have no more money in their weekly paycheck after this 40 years of innovation. Why?
It doesn seem to be an innovation shortage. Heard about the latest AI renovation? What we have may be a progress shortage. Meaning that in this wealthy era the wealth is not trickling down in a progressive fashion to help the common need.
As Oxfam's report suggests the poorest half of the global population is actually seeing its net worth dwindle so it is also a gap era like the 1920s & the Gilded Age. It's an argument that economist Thomas Piketty, author of Capital in the Twenty-First Century, makes and explains why is simple terms. It's about the growing inherited wealth via return on investment.
The ratio of wealth to income is rising in all developed countries and absent extraordinary interventions, we should expect that trend to continue. But if it continues, the future will look like the 19th century, where economic elites have predominantly inherited their wealth rather than working for it. Since this wealth does not rely on work, or work's values it may not even care about the quality of life of those who do the work. And that is a problem.
This point is also made by Nobel Prize winning economist Joseph Stiglitz. Both warn of the socio-economic impacts of a widening gap. Among those problems are changes in the lives of working-class Americans, rooted in policy choices and shifts in technology as well as the world situation. Shifts include outsourcing to poor parts of the world without union protection, stagnant wages, erratic hours, defanged unions, deindustrialization, ballooning debt, nonexistent sick leave, dismal schools, predatory lending, and dynamic scheduling. All problems.
But wait. There is mitigating charity and philanthropy. Can the super-rich and their companies may save us through enlightened charity? Take Microsoft for example. Microsoft has unveiled plans to commit $500 million to advance affordable housing solutions across the city of Seattle, Washington. The money, to be distributed as loans and grants, will kick-start new solutions to the city’s housing crisis, where income increases have lagged behind rising housing costs for professions like teachers. Good.
But is it good enough and the right stuff?
Some think not. Philanthropy of the super-rich may not be an inadequate substitute for a fairer world – it may actually be intentionally and unintentionally part of the system that perpetuates the gross unfairness of mass inequality. That is the argument made in Anand Giridharadas “Winners take all.” He argues that you can inspire the rich to do more good but never tell them to do less harm (such as moderating the wealth gap by imposing inheritance taxes). And he goes to argue that you can inspire the super-rich to give back in a personal charity say, but not to take less by such things as providing a living wage or keeping jobs in the US.
And you can inspire them to join a benign, light solution, but never accuse them of being part of the problem (how come you let foreign sources run free on your web site?)
As Stiglitz insists we need to ask more of the wealthy and have them understand the larger non-economic picture. A humanist picture if you will.
It starts with us all understanding that inequality is not just the result of bottom line economic forces. It is soceo-political and always has been. With current Citizens United type rulings and policies that give wealth political influence we are stuck with the problem. It isn’t inevitable that return on large capital will also be greater than overall economic growth. It is targeted political policies, processes and laws themselves currently make this so. And these policies are affected by the historical level and nature of built in status, political and economic inequality. Greater inequality entrenches greater power in the wealthy, who will reflexively use that greater power to double-down on policies (low capital-gains rates, low inheritance taxes, low barriers to campaign finance itself) that ensure greater inequality, and so on, in a vicious cycle.
So sure, economic charity may patch things up here and there, but in a wider view only an enlightened politics can correct for the depredations that the super-rich's gobbling wealth growth promises.
As a Humanist these problems trouble me. And these things are part of a rationally compassionate future that we envision (as discussed in a September – Is this a Humanist Century). They are important for all Free Thinkers to consider. Humanists need to concentrate on improving the things of this world rather than simply combating the illusions of supernaturalism. As secular humanists we may applaud some charitable efforts, but question them from a deeper look at a deeper constellation or system based on humanist values and principles. These including promoting fairness, truth and justice.
Who can we partner with us and how can be shape philanthropy to take on some of these issues we value like the separation of church and state? This would include the continued problem of the massing of wealth and power by religious and ethically religious groups.
We can also ask, “Does a notable amount of philanthropy support value free inquiry & truth, as a norm?” or
“Does a notable amount of philanthropy support ethics based on critical intelligence and critical thinking to establish truth?”
And what about supporting a moral education, that the value of a person is not entirely based on their group identify?
These and other issues such as how hard a sell is it to promote action that will mitigate likely problems and advance the common good will be discussed at the January 26th meeting of the WASH Maryland-DC chapter at the Maryland Chevy Chase library (1:30 -3:30).
All are welcome.