Text: Dominic Munton
Illustration: Sarah Beaulieu
Social inequality is a corrosive phenomenon that negatively impacts all members of society. It is our responsibility to educate ourselves as to what social inequality is, how it affects society and what we as individuals can do about it.
Social inequality is the uneven distribution of resources amongst individuals in a society. It takes into account individual income and wealth, as well as access to jobs, freedom of speech, healthcare, education and political representation. Though a constant feature of human history, its extent has nonetheless varied in response to the ability of individuals in a society to organise themselves. Inequality often resists discussion because it can easily seem inevitable, but, with increased communication and awareness, it is possible to combat its worst effects and reduce its magnitude.
According to Dr. Louise Warwick-Booth, Professor of Sociology at Leeds Beckett University, “Defining social inequality is difficult … and, as a consequence, measuring inequality is also problematic”. The most common metrics used to measure inequality measure disparities in income, consumption and wealth. These factors are relatively easy to assess, but, though they do show strong correlations with more social components of inequality, they are unable to represent them directly. Other metrics attempt to directly report these social factors such as access to healthcare and the status of women in society, or even happiness, but obtaining accurate figures for these more diffuse notions is problematic. Recent years have seen a drive for new metrics, especially in the US where social scientists suspected that older models were underreporting the recent explosion in national income inequality. This article will concentrate primarily on income inequality due to the availability of reliable data.
One of the worst impacts of inequality is its corrosive effect on politics and democracy.
The simplest and most common metric, the Gini Index, only measures inequality in income distribution. Despite the relative ease of obtaining data concerning income distribution, assembling data from every country in the world and standardising it in such a way that it can be compared still poses significant logistical challenges. As such, the following information is based upon estimates obtained from The Standardized World Income Inequality Database (SWID). In 2015 Norway had an estimated Gini Index of 25.3 (out of a maximum of 100) and was considered one of the most equal countries in the world. The US scored 38.1, the worst of all the developed Western economies and within a whisper of China at 39.9. By contrast, Namibia, one of the most unequal countries in the world, scored 57.2. Though there is no data available which directly reports a world Gini Index, there are several respected methodologies which “…combine the detailed country-specific income distributions into a global distribution of income”, according to Zsolt Darvas, Professor of Economics at Corvinus University in Budapest. According to the SWID’s estimates, in 2015 the global Gini Index was 57.35, a level of inequality equivalent to that found in Namibia.
To get an idea of what it means to live in a society with extreme equality, we can take a closer look at Namibia. The World Bank reports that in 2015 Namibia had a GDP of $11.8 billion and was classified as an upper-middle income country. However, 70% of this GDP was controlled by the wealthiest 5% of the population; the poorest 55% controlled only 3% of GDP. According to a report issued by the Namibian National Planning Committee, in 2015 approximately 29.6% of the population of Namibia were unemployed and 26.9% lived in extreme poverty. The infant mortality rate in Namibia has fallen by a factor of three since 1966, but in 2015 it was still 16 times higher than that of Norway. As members of the Norwegian society we have the privilege of living in one of the most equal societies in the world, and yet as members of the human race we are living in a world as unequal as Namibia.
Inequality’s most potent ally is individual apathy.
For us students studying in Norway this all sounds very distant. What has any of this to do with us? In this era of globalisation and climate change we are forced to recognise that no nation is truly an island. We are both members of Norway at 26.8 and the World at 57.35 and, if we do not act, the consequences of global inequality will affect our lives even here. We can no longer only search for justice within our own countries; today we must champion equal human rights worldwide.
What are the effects of inequality on society at large? According to Noam Chomsky, a prominent US political commentator and intellectual, one of the worst impacts of inequality is its corrosive effect on politics and democracy. In a society where people are equal, individuals have similar political agendas; a law that is detrimental to me is likely to be so to you and vice versa. In societies with high inequality, the rich and the poor form separate social classes with different political agendas. The poor may want better access to free healthcare and education or safer working environments, whilst the rich are more likely to favour tax cuts for high-earners and the deconstruction of state welfare systems. In a country like the US, the huge wealth of the super-rich is transformed into political power through lobbying groups and privately-sponsored think-tanks that seek to influence legislation. The poor cannot hope to compete on these terms, and so government policy is altered to favour the interests of the rich – further increasing inequality within the society.
Income inequality in the US has skyrocketed over the last 40 years: in the 1960s, average CEO pay was 25-30 times that of the average worker. By 2007, CEOs were taking home 350 times more than the average worker. In 2005 the CEO of Wal-Mart received effective pay 900 times higher than the average employee. This rise is set against a fall in top-bracket income tax from 90% in 1960 down to 37% in 2018. Over a similar period, corporate profits grew by a factor of 10 at the same time as corporation tax fell by 30%. The concentrated wealth accrued in these years has not been sitting idle; in 2017, corporate lobbying amounted to $3.4 billion, twice as much as a decade before. To put this into perspective, the entire running costs of Congress only amount to $2 billion.
The Equality Trust is a UK based charity that strives to promote awareness of inequality and its impacts. In 2009, two of its founders, Kate Pickett and Richard Wilkinson, published the findings of 25 years of research, demonstrating that inequality negatively impacts economies, social mobility, crime levels, individual health and levels of trust and participation within a society. Inequality was linked to decreased financial stability and increased chances of financial crises and inflation. Countries with high inequality were less socially mobile and scored lower on metrics of education. Inequality correlated with increased property crime and increased violent crime. Higher levels of inequality were associated with increased stress and status anxiety within a society whereas more equal societies enjoyed longer average life expectancy, reduced occurrence of mental illness and obesity, and lower infant mortality rates. More equal societies also reflected higher levels of trust, more social and civic engagement and higher chances that their citizens would report themselves as being happy.
When we accept the status quo as inevitable, we participate in maintaining it.
What does all of this have to do with you and I? For the purposes of this article, there are roughly three groups in our global society today: The wealthy 1%, those in poverty and those who fall somewhere in-between. Unless they should suddenly be overcome with a bad case of morality, there is no motivation for the richest 1% to take action on equality; any change in policy will necessarily mean a smaller slice of the pie for them. Those in absolute poverty are likewise ill-positioned to take action because they are enmeshed in a daily struggle for survival that leaves them little time to consider the day after tomorrow or other individuals in the wider global society. This means that inequality is our responsibility. If anyone has the time and the motivation to do anything about equality it has to be us – meaning you and I. Inequality’s most potent ally is individual apathy. When we accept the status quo as inevitable, we participate in maintaining it. But what are the potential consequences of inaction?
If, as a global society, we are unable to come together and face this issue, then the consequences are likely to be severe. A 2014 study, partly funded by NASA, investigated various historical civilisations such as the Roman, Han, Gupta and Mesopotamian Empires in an attempt to isolate common factors in their demise. The study identified two key features in these societies; “the stretching of resources due to the strain placed on the ecological carrying capacity”, and “the economic stratification of society into Elites and Masses (or Commoners)”.
According to the study, these phenomena have been implicated in the collapse of all human civilisations over “the last five thousand years”. Over-exploitation and environmental degradation result in a decline in agricultural impact to which the poor are most susceptible. For a time, the elite are cushioned from agricultural shortfalls by their wealth, but eventually the collapse of the poor due to famine also results in the downfall of the elite class. Finally, the study states outright that:
Collapse can be avoided and population can reach equilibrium if the per capita rate of depletion of nature is reduced to a sustainable level, and if resources are distributed in a reasonably equitable fashion.
The results of this study demonstrate that inequality is an issue that ultimately affects everybody, irrespective of wealth.
How might the world look if we were to distribute its resources in a more reasonably equitable fashion? Quite simply, we do not know and, unless we fundamentally change the present situation, we will never know. Though there are flaws in a direct comparison, one way to hypothesise would be to imagine a shift from Namibian levels of inequality to Norwegian levels. In such a world, average life expectancy might be 30 years longer, and rates of unemployment, HIV and infant mortality might be 95% lower. According to the United Nations Office on Drugs and Crime, murder rates in Norway are 95% lower than in Namibia and spending on health care is 65 times higher. Who wouldn’t want to live in such a world?
So, how do we make this happen? The Equality Trust publishes an individual manifesto online which outlines possibilities for participation. Their suggestions include: joining trade unions, participating in or creating local equality movements, purchasing products from companies that treat their employees fairly and moving your money into ethical banks or mutual investment societies. You can check out the whole list for yourself at their website: www.equalitytrust.org.uk. But the most important change begins here and now, right after you’ve finished reading this article; let’s start talking about inequality and stop pretending that it is an inevitable consequence of human ‘civilisation’.
Social Inequality, A reader’s guide – (https://uk.sagepub.com/sites/default/files/upm-binaries/57024_Warwick__Social_Inequality.pdf)
The Standardized World Income Inequality Database – (https://fsolt.org/swiid/)
World Bank Namibia Report – (https://data.worldbank.org/country/namibia)
Namibian National Planning Committee Report 2015 – (http://www.na.undp.org/content/namibia/en/home/library/poverty/nimdpovmao2015.html)
History of US Federal Income tax rates – (https://bradfordtaxinstitute.com/Free_Resources/Federal-Income-Tax-Rates.aspx)
Growth in US corporate profits – (https://tradingeconomics.com/united-states/corporate-profits)
US Congress Annual Budget – (https://fas.org/sgp/crs/misc/R43557.pdf)
US corporate lobbying – (https://www.opensecrets.org/lobby/)
UK-based Equality Trust – (https://www.equalitytrust.org.uk/)
Part NASA-funded civilisation collapse study – (https://www.sciencedirect.com/science/article/pii/S0921800914000615)