What's really driving inequality?

Global inequality is a topic du jour. It’s on the lips of everyone from the NGOs to the UN to the Davos set, and rightly so. Oxfam’s recent unearthing of the fact that the richest 85 people have the same wealth as the poorest 3.5 billion is truly shocking to anyone with a conscience. Unfortunately, none of them is prepared to seriously tackle the mother of all causes: perpetual economic growth. In fact, they are all slaves to it.

It’s not difficult to pinpoint some of the more visible structures and decisions that have led to this situation. Depending on your politics, you could credibly argue we have been on this path since the creeping start of capitalism during the industrial revolution, all the way through to the latest dramatic rise following the deregulation frenzies of the 1980s. Any way you look at it, though, behind today’s particularly egregious situation is a host of decisions or structures, including tax havens, corporate exceptionalism under the law (think “too big to fail” to see the sharp end of that trend); the flooding of politics with money, particularly in the US; and trade rules heavily rigged in favour of those with the most money and lawyers. And supporting it all is the creation known as the hyper-consumer, whose compassion is dulled and whose competitive instincts are permanently primed thanks to ubiquitous demands to buy, buy, buy and then continuous glorification of the idea that happiness is what you own. What else is the $1 Trillion advertising industry for? Taken all together, the global economy is essentially now a wealth extraction system; ruthlessly efficient at drawing financial and resource wealth away from the majority of people and piling it up in the bank accounts of the 1%.

The reasons for all this are, of course, many and complex. But stand far enough back and it’s also quite simple. Essentially it boils down to the fact that the corporate capitalist system is governed by incentives and rewards that are unable to directly register anything but economic value. The system is deaf, dumb and blind to climate destruction and mass human suffering. It would be like asking a human being to hear dog whistles. In other words, by just doing what it does, left to obey its own logic, the economic system will grow until it destroys itself, and causes immeasurable damage to the biosphere in the process. It will consume resources until there are none left. It will grind over humanity, causing and excusing human rights abuses on whatever scale is necessary for it to keep growing, even until all the energy of humanity is exhausted and the system collapses. It is, at this stage, far bigger than any government or corporation. It is, to all intents and purposes, a living force. It’s not alive in any traditional sense, of course, but it is undoubtedly possessed of an energy beyond our control. Unless the logic driving it is changed, the future is pretty much set in stone.

Complaining about the system can be quite therapeutic but we must also be able to isolate strategic weak points and offer positive alternatives. So here is an example of how the logic of perpetual economic growth is powering one more hidden but strategically critical drivers of inequality, and what can be done about it.

The World Bank’s mission is to “[E]nd poverty within a generation and boost shared prosperity.” They had their PR problems a few years ago when their infamous Structural Adjustment Programs were shown to create more harm than good, but since then they have had a fundamental re-think, right? Wrong. The problem is, because they can’t see, or don’t know how to begin to counteract the toxic logic of “growth at all costs”, they’re peddling the essentially the same snake oil today.

Through a system called the Doing Business rankings, the Bank uses its considerably financial and political power to force developing countries to make it as easy as possible for land to be grabbed by foreign corporations or local elites. It works by awarding points to countries when they act in favor of the “ease of doing business” and then publishing how countries rank against each other annually in a report they are very proud to claim, “has served as an incomparable catalyst for business reform initiatives”. In other words, policies that service the needs of intensive, large-scale international business are rewarded and ones judged to stand in its way are punished. For example, the fewer regulations there are on the purchase of land, the higher the rating, with maximum points being awarded to countries with total freedom of purchase. More modest corporate taxation gets some reward; most points are awarded for zero corporate taxation. Countries are even punished for offering their workers minimum wages. It is the neoliberal blueprint for economic development: low corporate taxation, low worker wages and protection, maximum privitisation and minimal standards of environmental protection. Everything, in other words, to maximize wealth extraction and concentration.

You might well ask why a supposed development agency favours large corporate interests so blatantly. The reason is simple. The World Bank is controlled by rich governments and so, perhaps unsurprisingly, it believes that what’s good for growing corporations – most of which are from rich countries - is good for the world. In perfect harmony with the G8, the Bank behaves as if Corporations’ ability to maximize profit and shareholder value is at the root of all prosperity, not just the prosperity of the rich, and is therefore more important than supporting the smallholder farmers who are currently feeding 70% of the world; more important that ensuring industrial activity doesn’t contribute to climate change; and more important than letting democratic countries set their own economic policy.

In a world where farmers, pastoralists and Indigenous Peoples are facing increasingly harsh conditions, and where the richest 85 individuals have the same wealth and the poorest 3.5 billion people combined, it is unconscionable that an organisation that is supposed to help increase everyone’s wellbeing uses it’s power to support the already rich at the expense of the majority.

We’ve launched a campaign to try and get them to throw out this ranking system. The Bank had the first of two big meetings this year on April 11 - 13. With farmers groups and civil society organizations from around the world, used that moment to introduce them to the Our Land, Our Business campaign, and then work through till the Annual Meeting in October to get as many people, from as many countries as possible to hear about this and stand with us. With lots of signatures, press activity, off line protests and social media, we believe we can generate enough critical and very public attention to force them to abolish the Doing Business system. The Bank hates bad publicity and has changed its ways because of it in the past, so we’re going to give them some.

Inequality is a defining problem of our times, we all know that. Help us call out one of the essential drivers behind it; one masquerading as trying to fight it.

Organisations and individuals can sign up here.

Watch a https://www.youtube.com/watch?v=koI6lGxhPj8">video

* Alnoor Ladha, Executive Director, /The Rules
Alnoor’s work focuses on the intersection of political organizing, storytelling and technology. He is the Executive Director of /The Rules (/TR), a network of activists and organizers focused on mobilizing citizens in the Global South to address the root causes of inequality and poverty (e.g. land rights, trade policy, tax justice) rather than simply focusing on aid. Prior to /TR, he was a Founding Partner and the Head of Strategy at Purpose, an incubator for new types of social movements. Alnoor is an industry writer and speaker on new forms of activism, the structural causes of inequality, movement entrepreneurship and social innovation, with a focus on emerging economies. He is currently a Board Member of Greenpeace International USA and a visiting lecturer at New York University (NYU), Columbia University and the Ontario College of Art and Design (OCAD). Alnoor holds an MSc in Philosophy and Public Policy from the London School of Economics

* Martin Kirk, Head of Strategy, /The Rules
Martin Kirk is Head of Strategy for The Rules. In this role, he will be responsible for the campaign framing, strategies and delivery globally, and supporting partners and allies to deliver campaigns nationally and regionally. Before joining The Rules, Martin was Head of UK Campaigns at Oxfam GB. As well as leading the campaigning teams in England, Scotland and Wales, he co- authored Finding Frames: New Ways to Engage the UK Public in Global Poverty and various related pieces that have helped challenge and evolve public campaigning models. Prior to Oxfam, Martin was Head of Global Advocacy at Save the Children UK, where he was responsible for high-level advocacy with donor and recipient governments and multi-lateral institutions. He has written for numerous publications including The Independent, The Guardian, Al-Jazeera, Foreign Policy in Focus and the journal of Ethics and International Affairs. He holds a BA (Honors) in Modern History from Kingston University.

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