A recent report released by the United Nations Development Programme (UNPD) at the end of January offers further confirmation about the role inequality has played in stifling economic recovery and preventing meaningful social reform; and the solutions outlined by the study are no less a deviation from mainstream proposals in calling for redistributive policies, increases in social spending, collective bargaining, and changes in social and cultural norms.
It has long been observed that genuine inequality exists in both low and high income countries. One area of particularly egregious inequality is income, and its implications are notoriously well-studied. The report wastes no time in reiterating the devastating results produced by the economic system: “1 percent of the world population owns about 40 percent of the world’s assets, while the bottom half owns no more than 1 percent.”
But the empirical evidence doesn’t seem to go far enough in convincing people of the need to pursue the above changes—and others. This is due, in part, to the fact that “inequality” has become a buzzword, used as a blunt instrument by casual observers of the political scene. But serious observers have more sincere motives—to reveal the gruesome reality of the state of human beings on the planet as a result of pervasive inequality—often lost in the spin-doctoring of dogmas that admonish the expanding role of government. A fierce propaganda campaign, ensconced by the rhetoric of market fundamentalists and their Washington allies, is persistently undermining the moral work of those in the social sciences whose contributions have made crystal clear the need to address social and economic inequality before it stamps out the possibility of decent human life.
Indeed we must know what we’re talking about when we say ‘the world is afflicted with deepening inequality’—as it is observed to be. Income inequality is chiefly discussed in the media and more casual analysis, but there is much more to the story.
Understanding economic inequality involves a number of factors. First, some idea of “human well-being” must be conceived of, and, more or less, universally accepted. The UNDP links a plurality of elements to a particular conception of human well-being that encompasses “material, relational, and subjective dimensions”—examples span from nutrition and life expectancy to access to public goods such as health care and education. These “indicators,” as they’re called, represent the different ways inequality can manifest itself in a society though measurements of material well-being generally serve as the most poignant examples of the kind of inequality that is devastating much of the world.
The study points out that the issue of economic inequality is really a matter of examining the link between what are called economic opportunities and outcomes, and this encompasses an extremely vast territory of analysis. For example, is it seen that the child growing up in a low-income family in inner-city Detroit has the same opportunity to pursue higher education than some other child with much better means? Is it due to income primarily, or are there other societal, historical, racial, and psychological factors preventing other children in similar circumstances from pursuing higher tracks? Perhaps such factors distort capacities to conceive of opportunities themselves or to discern pursuits which benefit a person’s well being rather than harm it. There are a number of factors which may compromise access to the kinds of opportunities we think every person ought to have, and indeed such access is highly unequal.
It’s been shown that income disparities correspond to inequities in the other domains—such as child mortality, for example. The report found that “87 percent of the variation in the ratio of child mortality rates between the richest and lowest quintiles can be attributed to variations in wealth inequality” (wealth being synonymous with income); but income [wealth] isn’t the most significant factor in this debate, and policy prescriptions that situate income as such miss some very important details.
In the West, many such policies are aimed at forcing the state to capitulate in its efforts at expanding its social policies and prescriptions which, it is believed by adherents of Chicagoan economics—so-called libertarians—represent an attack on the sanctimonious principle of wealth creation enshrined in the preeminent doctrine of neo-liberal capitalism. Development theory—the discipline primarily addressing inequality—has suffered at the hands of highly politicized proposals, confining what’s possible to what’s politically feasible. The establishment consensus is blindly drawn to growth rates and efficiency, and hence GDP is more or less implicitly the driving indicator in the discourse of practical solutions.
But there are unexplained gaps in the data that leads one to suspect that spurring economic growth might not result in improvements in health, nutrition, education, and other outcomes. There is a commonly held assumption in the economics profession that holds wealth creation to be the sole mechanism in addressing problems of human well-being in all of its constitutive elements. Giving money to poor people doesn’t result in the eradication of poverty. We know poverty includes a number of variables spanning family breakdown, truancy, drug abuse, as one Telegraph article cites. The same can be said for the issue of inequality: we must address the many dimensions of this complex issue if we hope to resolve it.
As it stands, a continuation of establishment policies reflects the need to adopt a range of remedial prescriptions in order to reintegrate those disenfranchised by inequality into a more capabilities and opportunities driven environment. This can only be accomplished by giving desperately needed aid to those squeezed out of the corporate-captured society—by reinforcing the role of the state, promoting inclusive growth practices, and changes in social norms and institutions. Though the prospects remain in question, a more equal and just society is within reach if we simply acknowledge the scope and breadth of one of the most fundamental problems facing us today.
The full study can be read here.