Has the tide really turned? Well, it depends on your perspective. Is the tide turning for the better or for the worse? Before exploring further, let me confess that I typed this piece with English rock band Pink Floyd cofounder Roger Waters’ The Tide Is Turning adding to my keyboard’s sounds.
Only minutes before, I had read Oxfam’s report on the widening inequality gap, which was released as the wealthiest people gathered at the World Economic Forum, in Davos, Switzerland. Or course, the timing of the report’s release was intended to have the maximum impact and to highlight the growing chasm between rich and poor. But it is not as if Oxfam had to wait for Davos for the report to have an impact.
The numbers are most disturbing; “even if you have a heart of stone”, to borrow from the original Sun City advertisement, the report will rock you “like you’ve never been rocked before”.
According to Oxfam, 42 people hold as much wealth as the 3.7-billion people who make up the poorest half of the world’s population. This compares with 61 people in 2017 and 380 in 2009. Over the past 12 months, at a time when the bottom 50% of the world’s population saw no increase, the wealthiest 1% generated 82% of the globe’s total wealth. In 2017, a billionaire was created every second day.
You do not have to be an economist, know an economist or know someone who knows an economist to know that it is unacceptable and unsustainable for a very tiny minority to accumulate such massive wealth, while the majority of the people are condemned to a life of absolute poverty.
Oxfam argues that the concentration of extreme wealth at the top is not a sign of a thriving economy, but rather a symptom of a system that is failing the millions of hardworking people who subsist on poverty wages.
Oxfam wants a rethink of the global economy, where there is excessive corporate influence on policymaking, erosion of workers’ rights and a relentless drive to minimise costs in order to maximise returns to investors. It also wants world leaders to turn the rhetoric about inequality into policies aimed at tackling tax evasion and boosting the pay of workers.
Being bombarded by these numbers might well have made you numb – ‘comfortably numb’ – to the fact that South Africa has one of the highest, if not the highest, inequality gaps in terms of income distribution. As I continue to type away, the music in the background has progressed to Pink Floyd’s Comfortably Numb, which includes this line: “I’ll need some information first, Just the basic facts, Can you show me where it hurts? … I have become comfortably numb.”
Well, if you are in need of some information first, then you would do well to read an opinion piece by Michael Nassen Smith, of the Institute for African Alternatives (IAA), which appeared in Business Day on October 16, 2017, under the headline ‘How inequality is wrecking SA’s economy, and what we can do about it’.
According to ‘National Income Dynamics Study’, which is implemented by the Southern Africa Labour and Development Research Unit based at the University of Cape Town’s School of Economics and funded by the Department of Planning, Monitoring and Evaluation, 29% of South Africa’s population is trapped in severe poverty, with four-fifths of the rural population living below the poverty line – this while the rich keep on getting richer. From 2007 to 2017, the cumulative holdings of the top ten on the JSE increased from R64-billion to R280-billion. Then, most tellingly, the CEOs of the largest listed firms earned between 120 and 1 332 times more than the average pay at their companies.
I fear that there is a tendency in the world, which is mirrored in South Africa, not to take immediate corrective action against inequality. If change does not come from the top, it will surely come from the bottom. Most appropriately, Pink Floyd’s Mother, now in the background, reminds me: “Hush now, baby, baby, don’t you cry, Mama’s gonna make all of your nightmares come true, Mama’s gonna put all of her fears into you.”