Making headlines is a report from Oxfam, based upon Credit Suisse accrued data (2000-2014), showing what we all seem to know (or heard) – that the rich are getting richer and the poor, poorer. Incredibly, the wealthiest 1% of the earth’s population (currently about 7.3 billion people) control nearly 50% of global wealth – a measure of financial and resource assets that total >260 trillion USD. Moreover, the top 20% control roughly 95% of wealth, while the remaining 5% is divvyed up over 80% of the world’s population. Talk about a pyramid! And its not the only one, as wealth distribution is inordinately regional – Europe and North America control roughly 65% of the wealth, Asia (including China) 25%, while Africa, India, and Latin America clock in at a measly 6% (although they constitute nearly half of the world’s population). The data also show that top 100 richest people control roughly the same wealth as Africa, India, and Latin America combined.
So, something is insanely wrong as of late, right? Not exactly, long-term statistics actually show that with ups and downs, it has been like this for quite a while – namely, that wealth distribution is, and always has been, inequitable. Why is there mass inequality might be the better question to ask? Typically, the present system of worldwide economics, i.e. globalized capitalism, is blamed as the source of inequity. Clearly, this form of capitalism has concentrated enormous wealth in the hands of a few, e.g. billionaires and plutocrats that, on the basis of disproportionate wealth, exert disproportionate power either directly or indirectly. These include hyper-rich like Bill Gates and Warren Buffet, who wield indirect influence, oligarchs that aim to exert direct political influence like Roman Abramovich or his mentor Boris Berezovsky, the American Koch brothers, Sheldon Adelson, or the Turkish Koç’s, for example. But this phenomenon isn’t limited to individuals, rather crony capitalism exists (if not thrives) just as impressively at the corporate level, whereby CEOs and managers, particularly of global banks and financial service firms seek to sway, if not directly control, regulations that govern their operations. This influence peddling (legal or otherwise) is entirely independent of whether it has a positive benefit upon the end-user society – witness the 2008 financial crisis and subsequent global recession. Those most hurt were the poor and middle class, while those who most benefited were, ironically, the wealthy and corporate finance.
So free-market capitalism and its distortions cause systemic inequality, right? Not likely either – this is because even under classical and medieval feudal societies (i.e. monarchies) or semi-feudal systems (e.g. Czarist Russia), or during the limited application of Marx-Engels-derived Socialism, wealth distribution was very far from equal. And yet while capitalism won the ideological struggle, it has apparently failed to provide prosperity for the majority of the earth’s inhabitants, based upon recent statistics. 200 years ago, ironically, most world societies (west vs. east, north vs. south) lived more or less equally, albeit being mostly poor and not too healthy. But along came the industrial revolution in Europe and elsewhere and, despite depression and wars, post-war Western and Asian countries gained an impressive 100-fold increase in wealth over that period. So capitalism is a success, right? Again, no – a huge gap opened up in terms of income inequality and, thus, most of the world remains poor (and unhealthy). So what’s the problem with capitalism, which offers the most opportunities to vertical movement, yet has failed to correct income and wealth inequality?
The irony in this story is that nothing is wrong with capitalism per se (if you accept the fact that it is essentially a pyramid scheme that necessitates an ever-increasing population with ever-increasing levels of consumption, i.e. the “grow or die” imperative), but rather in the application of capitalism, i.e. via human behavior. Selfish behavior, otherwise known as greed or avarice, leads to the excesses that exploit the subservient and benefit those solely at (or near to) the top. Thus, one need not be a Noam Chomsky or Malcolm X to realize that the problem is with people and their practice of capitalism and not it’s inception. Even Adam Smith, whose book Wealth of Nations (the bible of capitalism), accepted the idea that selfish behavior could be applied towards a common good, in terms of generating commerce and consumption. And he was right – capitalism can be a huge success – it generates markets via consumption, provides jobs and incentive to job creation, and is an engine for technological progress.
In the ‘87 film, Wall Street, the antagonist (for the poor and middle class, and protagonist for the rich) Gordon Gecko states that “Greed… is good” and that “Greed captures the evolutionary spirit.” How right he was! For greed is in our genes, its expression being the secret of our dominion over nature and over each other. It is greed that drives us to accumulate, to thirst for more, to be ever dissatisfied with what we have and with our situation. It is greed that drives us to crave power and influence, and greed that drives us to war. The reality is that despite the oft-mentioned examples of resource limitations and over-exploitation, we have everything we could ever need and, if used properly, fairly, and economically, there is plenty for everyone on this planet today. Now, don’t get me wrong – greed had benefits. For example, selfish behavior may have helped us step down from the trees to the expanding savannahs and forge both our growth and survival at the expense of competing groups of proto-humans. So, subjectively speaking, greed can be good – at least for a while. So is there a greedy gene or set of genes that manipulate us? Are they expressed differently in oligarchs and plutocrats versus the proletariat (myself included)? This is the idea of “genoeconomics” – that there are economic traits that influence one’s financial acumen and behavior. So far, although some genes do appear to enhance risk-taking or “fierce” behavior, no one gene has been shown to regulate banker’s behavior, for example. That said, a clever April fools joke published several years ago claimed that such a gene does exist and that bankers who have it express no shame or remorse regarding their behavior and, therefore, should be sterilized! (See http://citywire.co.uk/money/bankers-behaviour-explained-by-greedy-gene-study-finds/a483099).
While some might concur with this idea, the situation is likely to be more complicated. That is, no one gene alone is responsible and not necessarily is the trait heritable (i.e. it could be epigenetic, meaning a cellular or physiological trait not involving changes in the DNA sequence). Likely it is a case of nature coupled with nurture that confers a certain type of behavior. Most likely success in the aggregation of resources could be a one-off situation – no wonder royal/dynastic families, which have inherited titles and not genetic traits for success, were created. In fact, based upon gene-centric takes on Darwinian evolution, as espoused by modern evolutionists such as Richard Dawkins, suggest that selfish behavior at the gene level might actually engender cooperation within groups or societies (to the exclusion of others). This could imply that there is a power struggle going on at the gene level – one that which portends group commitment (e.g. altruism) and another which drives selfish/narcissistic behavior. Clearly, we all express both types of behavior, but when it comes to economics and wealth we humans invariably set up a playing field that engenders selfish behavior to the detriment of non-group others. So are plutocracies a product of our genetic ontology? Perhaps, but that doesn’t mean we have to live with it. Next time – Is there a way out of this destructive behavior?