WEALTH and POVERTY:

I have been examining how the distribution of wealth among the 7 billion people living across the world is measured.

I have to concede, first, that the concept of wealth is confusing: there are those who have lots of capital, and assets, and little income; and there are those who have lots of income, which they spend, and so have little capital. But both these groups are rich! and those with lots of capital, and a large income, are super rich. Then there are those with land and income; land but no income; no land and no income; labour skills and income/or no income. And there are 2.2 billion children. Second, during my researches, it has become clear that a lot more is known about the rich than the poor. For example, it is known that in 2007 there were 10.1 million $ millionaires in the world, of whom 103,320 were multi-millionaires, all of whom, together, owned $42 trillion [assets and income], out of a global GDP of $54 trillion. The World Wealth Report 2009, indicated that in 2008, as a result of the credit crisis, this number had fallen to 8.6 million $millionaires, including 78,000 multi-millionaires, controlling $32.8 trillion out of less than $54 trillion. At the top of this rich list were 1125 billionaires with $4.4 trillion. The World Wealth Report 2010 announced that there are 10 million individuals worth $39 trillion. Of these, 3 million are in Europe worth $9.5 trillion; 3 million in Asia-Pacific worth $9.7 trillion; and 3.1 million in North America worth $10.7 trillion. 53.5% of these richest people live in the USA, Japan, and Germany. Now, Forbes.com knows exactly who these people are, where they are, and what they do. In June 2009, Forbes reported that the billionaires had reduced in number to 793 and their fortunes reduced to $2.4 trillion. In April 2010, Forbes Russia revealed the 62 billionaires in Russia who had $297 billion. The World Wealth Report of 2011 declares that the rich are getting richer. 10.9 million people with access to investments worth $42.7 trillion. [3.1 million in the USA with $11.6 trillion; 3.3 million in Asia/Pacific with $10.8 trillion; and 3.1 million in Europe with $10.2 trillion.]  Forbes 2012 declares the 1226 billionaires are worth $4.6 trillion. For the many people, who believe that individualism and meritocracy and elitism are best, this millionaire elite represent this elect, the chosen, the blessed, the best of society: models for the rest of us. But what about the rest of us, the other 6.99 billion?

According to the elitist paradigm, it is just that the poor majority serve the interests of the wealthy elite.

According to the 'social freedom' ethic, the elite should serve the needs of all others by promoting the redistribution of wealth and the alleviation of poverty.

Anup Shah, in Global Issues, indicates that there are 5.4 billion people living on less than $10 a day; and 1.4 billion living on more than $10 a day. It is clear that poverty is the global norm. This is confirmed by a recent World Bank report which established that the average annual income across the globe is $8000, or $22 a day. The 1.4 billion people, who are the 'better-off', includes the millionaires and billionaires who live on more than $11000 a day: and those who live on more than $11 a day; those on average wages, $22 a day; those who are wealthy with more than $220 a day.

Gross wealth inequality is the global norm. The UN tells us that 10% of the global population are wealthy; 90% are poor. Many people fall between $22 and $220 a day, and may be regarded as 'comfortable'. A recent UN report suggested that if you earn $60,000 a year, you can be included amongst the wealthy. January 27th. 2010. In the UK, a report produced by the National Equality Panel, led by Prof.John Hills, revealed that 10% of the UK population received less than $44 a day [27GBP]; while 10% had an income of more than $186 a day; 5%, more than $232, and 1%, $464 a day. The poverty line was set at $54 a day [33.7GBP a day]. The report confirmed that the rich are getting richer, and inequality is greater in 2010 than in 1990 [after 20 years of the so called 'trickle-down' effect]. 50% of the UK population earn less than $91 a day [56GBP]. Journalists and politicians seem to find it difficult to accept the reality and significance of poverty and inequality. Publication of the Report led to discussions and debates on the BBC, and in the Houses of Parliament. The participants, like Lord Heseltine and Harriet Harman, were, however, more concerned with blaming the poor for forming an under-class, and accusing the political parties. We may tinker with the figures, but the truth is that most people in the world are poor, through no fault of their own! And some of these poor are to be found in the richest countries of the world like the USA, Japan, Germany.

The precise definition of poverty is difficult. Until recently absolute poverty was '$1 a day'. But if you have ever tried to live on a dollar a day, you will know that it is more accurate to say that you die on a dollar a day! unless you can live on half a kilo of tomatoes; or apples. In the USA, in 2007, the definition of poverty, for a family of five, whereby you become entitled to benefits, is $67 a day. For a single person, it is $30 a day or $10,991 a year. The latest US Census reports indicate that in 2007 37.3 million people [12.5% of the population] lived in poverty. In 2008, it is estimated that 17.1 million had to get by on $14.8 a day. 2009 reports confirmed that out of 310.5 million people, there were 43.6 million living in poverty, 14.3% of the total population. In 2010 it is calculated that 38 million people receive food stamps, and the minimum wage is set at $7.25 per hour. 2011, the Census declared 46.2 million people living in poverty. So, 'poverty' across the globe can be defined as living on an income of between $1 and $67 a day. In the UK, the Inequality Report indicates that there are 982,400 people with zero wealth, of which 614,000 are existing on no more than '$1 a day'. It seems to me that in our global capitalist society about 6.8 billion people may be described as poor, and 0.2 billion as rich, of whom 8.6 -10.1 million are very rich. If you live in the prosperous world, it will be difficult to imagine what it is like to be in the world of the poor. At this time of financial crises, it is possible to accept that for those on less than $10 a day, nothing has changed. Life remains a struggle - Survival accidental. Regular employment, a dream.

It will be more catastrophic for those who now have to live on $220, rather than $11,000 a day; for they will have to get rid of all their assets at cut price and may have lost all their savings and pensions as well as income. At the height of the financial crises, it seems that the International Monetary Fund is short of funds, and cannot help those distressed nations on the verge of bankruptcy. Some of the cash rich countries, like the Oil States, are being lobbied to provide funds for the IMF.

I would suggest that the millionaires, with their $ billion fortunes could be asked/required to contribute funds to the IMF and thereby help, significantly, to alleviate poverty across the globe.

But we all know from the Wealth Reports of Cap Gemini, and Forbes that the multi-millionaires will much prefer to spend their money on luxuries - another luxury car; a new boat; a cruiser; an aeroplane; a helicopter; another mansion, a hotel; diamonds, gold; a football team; paintings, and so on. The strategy paper by CITIGROUP in 2006 confirmed the existence of the plutonomy, and the need for fund managers to service their needs to the exclusion of the poor majority.

It is noteworthy that in 2010 a group of billionaires, led by Bill Gates, declared their intentions to raise their donations to charity, and actively support redistribution of money to alleviate poverty.

The financial crises have revealed clearly that the alleviation of poverty and inequality is not a priority for any social/economic/investment/financial/government policy! A prime priority is to protect the investments of millionaires and corporations from inflation, deficit, bankruptcy, austerity, recession, depression.

J. Kelvyn Richards
www.kelvynrichards.com
A Discourse: Social Ecology