Outside In | Political silence on inequality is strangling our prosperity and democracy

Academics warn that inaction is corroding politics and trust, and weakening prosperity and multilateralism, as support grows for the idea that democracy delivers unfair outcomes

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Activists from Amnesty international, Emergency and Oxfam stage a flashmob to denounce the inequality of vaccine access on October 29, 2021, on the eve of the G20 summit, at Piazza Vittorio in Rome. Photo: AFP

Published: 5:06pm, 8 Sep 2023

As we ordinary human beings worry about stagnating incomes, rising job uncertainty, increased electricity bills and the like, I was prompted this week to spare a thought for the super-rich, the shockingly different world they occupy, and to ponder the sustainability of such ridiculously extreme inequality.

At one end of the spectrum, you have South African financier Ken Costa wringing his hands over the threat of wealth destruction in a world set to become an “inheritocracy” as the world’s rich baby boomers transfer their wealth – around US$70 trillion in the US alone – to their “zennial” (his portmanteau for millennials and Gen Z) children or grandchildren.

Alongside Costa are the world’s wealth managers, stressed by an 11.7 per cent contraction in business volumes from their uber rich clients and a 4 per cent fall in global financial wealth last year – to US$255 trillion. One source of relief was that real asset wealth – covering property, art, jewellery, antiques, rare wines and such – continued to grow, rising by 5.5 per cent to US$261 trillion, which meant that total wealth squeaked out a 1 per cent growth last year to US$516 trillion.

To be fair, our global uber rich – the 2,640 billionaires and others who make up to world’s richest 0.1 per cent – appear to have had a bad time since Covid-19. Forbes’ 2023 list of billionaires has shrunk by 28 and around half are poorer.

But it is difficult to empathise with the challenges of the rich when 26 per cent of the world’s population still have no access to safe drinking water, 46 per cent lack basic sanitation and 13 per cent have no access to electricity.

There is a callous and unsustainable unfairness in hundreds of millions of people suffering such extreme hardship while trillions of dollars are being passed down to a small “zennial inheritocracy” in a tiny group of Western countries.