In the first world, the news corporations would have us believe that the pinnacle of human social organisation is the ‘Free Market Democracy’. This ‘theory’, rests upon a series of assumptions. Firstly, that humanity is best served when all people are free agents with an equal right to define the life they lead, free from coercion and oppression. Secondly, that the best way for these agents to be free and to interact with one another is within a ‘market’ where their interactions are regulated by a token based currency that signifies their mutually agreed upon value. And lastly, that because these markets and freedoms are open to manipulation and abuse, they can’t be trusted. Democracy, within this model, is the channel by which the ‘people’ have a voice in policing the system. In short, the majority can’t be trusted, so a minority is mandated by the majority to apportion and police their freedoms and monitor and regulate their interactions. Therefore, in it’s simplest terms, ‘Free Market Democracy’ is a social construction that empowers a minority to control the lives and interactions of the majority, supposedly for the benefit of alli. Ignoring the obvious contradiction between these uses of the words ‘free’ and ‘democracy’, the overarching concept is an important one to unpick, if we are to trust the future of the planet and our species to it.
One of the most widely used methods of measuring and presenting economic equality is the Gini coefficientii. It is a complex mathematical function, which when applied to various measures produces a number between 0 and 1. A population where all wealth is shared absolutely equally would have a Gini of 0. And conversely, a population where all the wealth was held by a single person and everyone else had nothing would have a Gini of 1.iii. At the end of the twentieth century, the World Bank estimated the Gini coefficient for the entire planet to be 0.67. iv By 2008 certain estimates were putting it as high as 0.71. However in 2016, much to the annoyance of some, leading academics were making the case that not only was inequality growing, but that it was never going to stop as long as international political power sat in the hands of those most closely allied to international economic power.v Perhaps one of the clearest examples of how convoluted the debate was becoming was when leading commentators and think tanks began openly questioning the political misuse of Gini. Only last year, it was claimed that the richest 0.1% were hiding as much as half of their total income, which was skewing certain official inequality measures.vi Once you start factoring in all the data, the argument becomes difficult to refute. Economic inequality is growing.
To avoid the argument becoming purely theoretical, it is important to remember how this inequality manifests itself in our everyday lives. It has been argued that as the twentieth century drew to a close, by almost every measure available, humanity was facing a species wide and environmental catastrophe of its own making. The economic model had failed everyone, except a very small minority. Nearly a third of the world’s workforce was unemployed, and large sections of the employed were in increasingly low-paid, part-time and insecure work. The value of labour had fallen, while poverty and child malnourishment had exploded. Across the planet, the public provision of social security, education, healthcare and emergency services was being systematically destroyed at an unprecedented rate. And to make matters worse, on a planet wide scale, the environmental mechanisms supporting life on earth; the atmosphere, water, soil and forests, were being destroyed at such a rate, that the only truly informed argument was fast becoming one of when it would collapse, as opposed to if it would collapsevii.
It is worth bearing in mind that this inequality isn’t some intrinsic flaw in our make-up. In fact, it is a relatively new situation we find ourselves in. For the vast majority of the hundreds of thousands of years that we have looked like we do today, anatomically speaking, we have lived in hunting and foraging communities that have been structured around very high levels of equality. It has been argued, that it was alongside the development of agriculture that the inequality within communities began to spread. This then picked up speed with the enclosures and the privatisation of the commons, further accelerating still as capitalism was embraced and the value apportioned to private ownership and individual labour within the ‘market’ shifted the power imbalance even further. Not only is it not natural, it’s not even helpful. By embracing this token system for apportioning value to life on earth, we have become hostages to the social construction itself. George Bernard Shaw argued that this poses a threat to the very development of humanity, as economic inequality hides true merit. And it appears he was right. It has since been demonstrated that the more unequal a society is the less patents per capita are issued. One of the driving forces behind human development, creative innovation, is being restricted by economic inequality. And it doesn’t just damage our creativity, our well being is at threat also. Pickett and Wilkinson argue that there is a very strong correlation between inequality and health. One of the key flaws in the system, they suggest, is that it requires communities to be divided by a self-interested consumerism that is driven by status competition.viii
One of the fundamental aspects of this system is the way that it manifests itself across subgroups of the population, in terms of gender, race, class and geographical location, and therein via multiple social institutions; sexual, cultural, political, academic and financial, amongst others. From entire populations down to each and every individual, the system seems to permeate every aspect of human existence in a process of constantly dividing and distancing. It is not enough for us to have our own individual differences, the system requires us to apportion value and status to each other based on them. Inevitably, it isn’t long before we struggle to see past the differences being amplified by the institutions of power. The north fears the south, the people of the sun fear the people of the frost, women fear men, the old fear the young, the not very poor fear the very poor. And all the time this fear nurtures mistrust and resentment. The true fundamental division within society is the inequality of power, which is lost in the various red mists being generated from above. There is a case to be made that the richest and most powerful 1%, by instigating division, are effectively destabilising any attempts at solidarity by the rest of us. Arguably, the 1% manage the 99% by getting the 99% to manage each other.
This power inequality, as exemplified by the economic inequality, is occurring across the entire planet. By 2003, the difference in inequality between entire regions was breath taking. The World Bank reported that Gini coefficients for Latin America were 10 points higher than Asia, 17.5 points higher than the OECD countries, and 20.4 points higher than Eastern Europe. And remember, this in a region, as rich as any other in human and natural resources. And this regional inequality didn’t just sprout out of the earth, like a long dormant weed. There are very clear political trends, that drive the economic trajectory on both the macro and micro levels. The increased acceleration of inequality in the south of the Americas was most highly visible in the 1980s. In Buenos Aires between 1984 and 1989, the richest 10% went from being 10 times richer than the poorest 10% to 23 times richer. While in Rio de Janeiro, the Gini went from 0.58 in 1981 to 0.67 in 1989ix. By implementing the system differently on a regional basis, disparities in economic inequality from region to region plays directly into the hands of divisive constructions, like the nation state, and from there into racist narratives, which further divide and distance us from one another.
And how is this explained away? Well, the ‘Free Market’ cheerleaders argue that inequality will eventually cause incomes to come together. This is calledthe convergence theory. However the evidence shows quite the reverse. Living standards have plummeted in the regions where inequality has been increasing fastest, like Post-Soviet Russiax. In reality, the institutions that have designed and implemented the global economic structure, have done so in such way that accrues the benefits to the richest 1%, while forcing the costs on to the poorest 99%. As part of the process, since the 1970s, primarily within the OECD countries, but very soon afterwards globally, the rich have been rebranding their wealth from personal income to corporate capital gains. Not only has this decreased their taxes and increased their wealth, but has also made hiding their riches that much easierxi. Hiding behind shell companies and numbered accounts, the 1% have divested themselves of any obligation or responsibility to the societies that they inhabit and benefit from, as well as corrupting the methods for measuring the inequality itself. And the wider impact of this behaviour? As the last century drew to a close, the poorest countries in the southern hemisphere were being forced to pay $0.5 billion dollars a day on compounding interest payments to the same financial institutions that were busy off-shoring the wealth of their owners and clients, while 1 in 4 people on the planet were starving and 1 in 3 children were undernourishedxii.
One of the sleight of hands being used to cover up the fact that convergence doesn’t occur, is the philanthropic paternalism of the rich. Unfortunately, the reality is a lot more complicated than the pop starswould have us believe.xiii Africa loses more money every year in tax avoidance by the multinational companies exploiting the continent’s human and natural resources than it receives in international development aid in return. The UN estimates that global tax dodging is costing developing countries the same amount of money it would take to ensure either basic health care or safe water and sanitation for 2.2 billion peoplexiv. And even when aid is received, because it is overwhelmingly designed and implemented by the same political and financial elite that are already exploiting the continent, it has often been little more than an effective mechanism for further exploitation and oppressionxv. One of the most damning studies of this is James Henry’s The Blood Bankers. In case after case, from one country to the next, for decades, a small group of people have conspired to squeeze every drop of ‘value’ from the developing world, whatever the cost. They have done this through multiple mechanisms, not least of all decapitalisation, capital flow, structural adjustments, off-shoring, irresponsible overlending, farcical building projects, privatisations, the driving down of employment and human rights, and of course the looting of central bank reserves. And before anyone can start blaming this on the victims, James Henry cites “Citigroup, JPMorgan Chase, … UBS, Barclays, Credit Suisse, First Boston, ABN-AMRO Merrill Lynch, ING Bank, The Bank of New York, American Express Bank, and about two dozen other leading Swiss, British, Dutch, French, German, and Austrian banks” as complicit in the decapitalization of the poorest countries on the planet.xvi When looked at globally, regional inequality is fundamentally tied to the overarching system of economic inequality.
At it’s very core, the system is said to be driven by one overarching obsession, growth. However, it is a very specific type of growth. The growing accumulation of power into an ever decreasing number of hands. Put simply, it is the growth of inequality that drives the system. Take agriculture as an example. The capitalist model pursues the growth of inequality in agriculture in direct contradiction to all the available evidence. As early as 1962, the Nobel economist Amartya Sen had shown, and the findings have been repeated time after time and in country after country ever since, that there is an inverse relationship between the size of a farm and the amount it produces per hectare. The bigger the farm the lower the yield. One recent study goes as far as to argue that a farm of under one hectare can produce up to twenty times the yield per hectare of a farm over 10 hectares in size. It just makes no logical sense for food production to be done on an industrial scale, when local community farming can deliver yields up to twenty times greater. Unless of course, the driving force is the accumulation of wealth and power into an ever decreasing number of hands. And before anyone says it is about feeding the planet, the problem isn’t that the planet can’t sustain the lives of 7 billion people, it’s that it can’t sustain self-interested consumerism. Between 1980 and 2005, for every 1% increase in global population there was an increase in CO2 emissions, but not an equal one. For every 1% population increase in sub-Saharan Africa CO2 emissions rose by 0.12%, while for every 1% population increase in North America emissions grew by 3.5%. By that calculation alone, North American lifestyles pollute at a ratio of nearly 30 to 1 compared to those of sub-Saharan Africa. The global population is growing, but most significantly amongst the people producing the least emissions. So how do the 1% respond to this? Once again by victim blaming of course. Apparently, in 2009 a group of billionaires in North America got together to agree on how best to focus their good will. The agreement they came to was that overpopulation was the problem. Or to put it another way, there was just too many poor peoplexvii.
Even within the so called ‘developed’ countries, economic inequality is just as malignant. In Pickett and Wilkinson’s study, a strong correlation between income inequality and mental illnesses in the richest countries is shown to exist. The strongest correlations occur in anxiety disorders, impulse-control disorders and severe mental illnesses. In one study, with individual data on over 60 million people, it was shown that just by reducing inequality in OECD countries, over 1.5 million deaths could be prevented every year. And what of our ability to critically analyse these societies we live in? Unfortunately, countries with greater inequality have lower educational attainment. Just as this is true between nations, so it is also true within nations, as has been shown between states in the USA. And the impact? One study in the UK showed that already by the age of three, a child born to a disadvantaged background could be anywhere up to year behind a child born into a privileged background in terms of their educational development. Further compounding this problem, is how the ‘market’ responds. In societies with greater income inequality, a higher percentage of GDP is spent on advertising.xviii So, when our psychological defences are down and our critical faculties hamstrung, the market responds by forcing us to compare ourselves and our peers to beautiful people living beautiful lives in beautiful worlds.
It is unsurprising that we are so very angry. The real problem though, is how that anger manifests itself. In a meta-analysis of 35 studies from around the world, looking at the relationship between inequality and violent crime; all but one found a positive correlation. As inequality within a population increases, so does violent crime. The closest correlation was in homicides and assaults, with robbery and rape less closely correlated. Although, I would take that second point with a pinch of salt due to the cultural and institutional complicity in failing the victims of rape. That being said, Pickett & Wilkinson argue that this correlation continues to persist through more recent studies. As a society becomes more equal, the violence decreases, and then when it becomes more unequal the violence once again increases. One of the suggestions to why this occurs is that violence towards others is often directly attributed to the perpetrator feeling humiliated or looked down upon. When the source of the humiliation is of sufficient status to be untouchable, the anger then gets displaced and redirected towards someone of lower status. Studies have shown that evaluating ourselves in relation to others goes much further than just making us angry. Low social status, lack of friends, and stress in early life have all been shown to negatively impact health and lifespan. Pickett & Wilkinson talk about this pent up anger as an evolutionary response to a very modern problem; being at the bottom of an unequal hierarchy that bases social status on something largely out of our control.xix Gregory Clark’s meta-analysis of the degree to which social status is handed down from one generation to the next, demonstrates exactly how out of our control social status actually is. Analysing data from medieval England, modern England, the US, India, Japan, Korea, China, Taiwan, Chile, and Sweden, the correlation varies between 0.7 and 0.9. For those who don’t know, a correlation is a measure between -1, a perfect negative correlation where one measure goes up the other goes down; and +1, a perfect positive correlation, which is when one measure goes up the other goes up equally. A 0 is no correlation. Clark argues that the data suggests a universal constant of intergenerational correlation to social status of +0.75. Put simply, social status is as likely to be inherited as is any biological trait.xx
And before anyone tries to pass this off as unimportant, the research tells a very different story. The role social status plays on the emotional and psychological well being of the individual has been studied in detail. They show that stressful situations elicit a greater response when they include a threat to one’s self-esteem or social status through the judgement of others. These have been called ‘social evaluative threats’. In societies where the cultural institutions are barraging individuals with status signifiers, such as physical appearance, willingness to behave in certain ways, and what products and services are owned; peer groups become the arbiters of status based on those signifiers. With the individual under constant threat of being apportioned social value by those around them, psychological coping mechanisms have to develop in order for the individual to survive. There is an argument that suggests that alongside the rise in anxiety this inevitably causes, has been a similar rise in ‘insecure narcissism’, particularly among young people. It proposes that, while we increasingly project outwards an image of being emotionally strong, judgemental of others and full of self-confidence, in reality on the inside we are more vulnerable to criticism, distrustful of others and hyper critical of ourselves. Compounding this problem, is the fact that studies show that we tend to make social status judgements of others within the first few seconds of meeting them. Now, one of the cornerstones of our development as a species, the ability to trust others in order to collaborate and cooperate with those around us, is under direct assault from the system.xxi
Amy Chua argues that where market dominance is clustered around ethnic groups, as defined by racially focussed narratives, the pursuit of increased inequality intrinsic to the system, disproportionately benefits those who begin with a head start.xxii This makes it easier for the demagogues who covet power, to use racial narratives to then divide the oppressed, and in turn make themselves the oppressor. Their call-to-action is inevitably based on a false premiss. It has been shown that health and social problems across multiple populations around the world are most closely correlated to how people experience their deprivation in relation to their surroundings, regardless of their ethnicity or racexxiii. But this hasn’t stopped the instigators of divisions. More recently, a very strong case has been made that the institutions of political and cultural power in Europe; the mass media, mainstream political parties, think tanks and celebrity academics are acting as the facilitators of extreme-right groups, by openly moving the public discourse towards the far-right in terms of their own policies and pronouncements. This ‘grown-up’ conversation is a classic process of pitting the victims against one another in order to avoid the reality of the situation. Firstly over mass-immigration, largely ignoring the fact that is is being driven by the collapse of the Soviet Union, the break up of Yugoslavia, and structural adjustments in the global south; secondly over the allocation of domestic employment and social welfare, once again ignoring the fact that the neoliberal model is the main cause of the cuts to social welfare through ‘austerity’, and the increasing levels of unemployment due to the the outsourcing of cheap labour through ‘globalisation’; and finally over the War on Terror, driving anti-multiculturalist narratives domestically, while largely ignoring the quasi-imperialist nature of the military actions taking place overseas.xxiv
In addition to being divided by race and class, one of the most fundamental of human relations, the one that the very existence of our species relies upon is also being subsumed into the ‘market’. By 2006, the global porn industry was estimated to generate $96 billion, with 13,000 films being produced every year in the US alone. Partnering with the porn ‘industry’ are mainstream corporations in radio, television, film, internet, technology, mobile communications, hotel, leisure, book publishing, banking, financial services, real estate, marketing and public relations. While the porn ‘industry’ looks like any other industry at the macro level, it is at at the micro level that its impact on society is most apparent. In terms of the workers involved, studies have shown that more often than not, the women being economically, culturally and physically coerced into taking part are victims of sexual and physical abuse in earlier life. The overwhelming majority of the output produced by this ‘industry’ is carefully scripted, directed and edited gender archetypes where women are, to differing degrees, presented as submissive, adolescent, masochistic, rape fantasists. And the ‘product’ that this ‘industry’ sells is almost exclusively being consumed by boys and men. Researchers now warn that an entire generation of men are increasingly understanding their relationship to women within the framework of this divisive, subordinating and violent narrative.xxv This can only continue because the ‘free market democracy’ allows it to. Kat Banyard’s 2010 book, The Equality Illusion demonstrates the level to which our modern society is gender divided, and how often this occurs during the very life stages most heavily regulated by the ‘democracy’ and the ‘market’. Schools are now, not only the place where women are most likely to be sexually harassed or sexually coerced, but they are also demonstrably perpetuating gender and class divisions. In the wealthiest nations educational attainment correlates very closely to both gender and class, while in the poorest nations the likelihood of a child even receiving any education is very often determined by their gender. It doesn’t get any better when we start working either. The ‘market’ values gender differently, even when the evidence demonstrates it costs money to do so. In the UK, where women receive lower pay and are less likely to run the largest companies, it has been argued that gender discrimination costs somewhere between £15 billion and £23 billion every year. These would only make sense if both the ‘market’ and the ‘state’ were actively trying to maintain gender inequality.xxvi
Based on the evidence laid out here, I believe it is easy to make the case that this system does not deliver on its promises. The vast majority of us are not free from coercion and oppression. We are not valued equally. And perhaps the cruellest irony is that it is those entrusted with policing the system that are manipulating and abusing it. Knowing how we came to be in this situation, and how we remain caught in it is of paramount importance. When we focus solely on one aspect of the inequality, such as race, gender, class, or geography, we lose sight of the overall lack of agency each of us has over our own lives, and the multiple methods by which we are all being subordinated. It is no accident that the campaigns to create solidarity across the 99% have in recent years become drowned out by the campaigns that fragment us. To truly end oppression we must start with the underlying understanding that all people are of equal value, regardless of gender, race, class or location. From there it is easier to make the case that the institutions by which this has been done, in the forms they exist today, cannot deliver us equality. They are fundamentally designed and developed by the 1% to do the exact opposite. And by allowing the 1% to determine the nature and forum of the fight back, we allow the 1% to maintain their authority. This economic and political construct that enforces inequality is in the process of destroying our planet, enslaving our bodies and our minds, and condemning our forebears to servitude. We must all fight for absolute equality. We must all fight for everyone to be valued equally. Our continued existence may well depend on it.
Nicolas Lalaguna is the author of A Most Uncivil War and Seven May Days
iMcMurty, John – The Cancer Stage of Capitalism, 1999 – p82
iiDavis, Mike – Planet of Slums, 2006 – p165
iiiPickett, K. & Wilkinson, R. – The Spirit Level, 2010 – p17
ivDavis, Mike – Planet of Slums, 2006 – p165
viiMcMurty, John – The Cancer Stage of Capitalism, 1999 – p82, 83
viiiPickett, K. & Wilkinson, R. – The Spirit Level, 2010 – p87, 207, 225, 233, 237
ixDavis, Mike – Planet of Slums, 2006 – p157
xHenry, James S. – The Blood Bankers, 2003 – p xxi
xiShaxson, Nicholas – Treasure Islands, 2011 – p199
xiiMcMurty, John – The Cancer Stage of Capitalism, 1999 – p83
xivOxfam America, Media Briefing – Broken at the Top, 2016 – p11
xvDavis, Mike – Planet of Slums, 2006 – p15, 155
xviHenry, James S. – The Blood Bankers, 2003 – p xxii, xxvi, xxvii, xxiv, xxvi,
xviiMonbiot, George – how did we get into this mess, 2016 – p103, 104, 106, 139
xviiiPickett, K. & Wilkinson, R. – The Spirit Level, 2010 – p66, 68, 90, 91, 98, 105, 110, 228, 230, 291
xixPickett, K. & Wilkinson, R. – The Spirit Level, 2010 – p38, 39, 40, 70, 135, 144, 166
xxClark, Gregory – The Son Also Rises, 2014 – p9, 12
xxiPickett, K. & Wilkinson, R. – The Spirit Level, 2010 – p37, 38, 44, 45
xxiiChua, Amy – World on Fire, 2003 – p6, 190
xxiiiPickett, K. & Wilkinson, R. – The Spirit Level, 2010 – p185
xxivFekete, Liz – Europe’s Fault Lines, 2018 – p28, 29, 30, 31
xxvDines, Gail – Pornland, 2010 – p xviii – xxxi, 47, 51, 52, 64
xxviBanyard, Kat – The Equality Illusion, 2010 – p15, 46, 48, 75, 76, 107, 109
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