By John Pickard
The regular spectacle of hypocrisy known as the ‘World Economic Forum’ is meeting in Davos this week. The focus of this meeting of the super-rich and extremely powerful – politicians and billionaires, especially – is apparently “rebuilding trust”. It would be comical, if it weren’t such a serious issue, to see these people pretending concern for their fellow human beings.
As the report from Marxist economist, Michael Roberts, suggests, the attendees at Davos probably are concerned about the world economy, its instability and the consequent social and political upheavals that flow from that. Above all, these pampered billionaires and the politiicans who are bought and paid for by them, will know that they are indeed distrusted, not to say despised and hated by large (and increasing) swathes of the population. As an article in the Financial Times noted, the theme of rebuilding trust “….could not be more timely, with public trust in governments still low in many countries”.
The FT, as we have said many times, may represent the interests of the capitalist system, but it is a serious newspaper and its commentators are in the main sober representatives of the system, unlike the hacks who write for the Tory tabloids. “If those gathered in Switzerland are serious about tackling declining trust”, the FT article suggests, “they must also raise tough questions about growing inequality”.
A shift of $1.5 trillion of wealth from the poorest to the richest
The article then gives some very stark figures about the rapid growth in income inequality, a level of inequality that is accelerating, rather than declining. “The most compelling example” it argues, “is the exorbitant pay divide between chief executives and workers. In 2022, CEOs in the US were paid 344 times as much as a typical worker, compared with 21 times back in 1965”. It is precisely the attendees at Davos who are responsible for this astonishing shift in wealth from the poor to the rich.
When it comes to wealth held by people, the gap is also accelerating. The fortunes of billionaires have more than doubled in the past decade. A report this week from Oxfam points a finger at the top five. “The world’s five richest men” it says, “have more than doubled their fortunes from $405 billion (£321 billion) to $869 billion (£688 billion) since 2020, while the wealth of the poorest 60 per cent – almost five billion people – has fallen, a new Oxfam report on inequality and global corporate power has found. If current trends continue, the world will have its first trillionaire within a decade but poverty won’t be eradicated for another 229 years”.
The Oxfam report also points out that during the pandemic, a new billionaire was created every 30 hours and, of course, little of this new wealth trickled down to the billions of workers whose income is failing to keep pace with inflation..
Since 2020, Oxfam points out, “people worldwide are working harder and longer hours, often for poverty wages in precarious and unsafe jobs. Across 52 countries, average real wages of nearly 800 million workers have fallen. These workers have lost a combined $1.5 trillion (£1.2 trillion) over the last two years, equivalent to nearly a month (25 days) of lost wages for each worker.”
The Financial Times correspondant happens to be a guest writer from Earth4all, so she, probably much more than the regular FT journos, at least understands that there is a problem wihin the capitalist system itself. “Such divides”, she wrote, “are the sign of something fundamentally wrong with the system”. Indeed
With worsening inequality, social tensions will continue to rise
She elaborates: “The concentration of immense wealth in the hands of a few can also bring disproportionate influence over governments, thereby entrenching even deeper divides. The results? As Earth4All’s Social Tension Index concludes, with worsening inequality, social tensions will continue to rise in this century, thereby fuelling populist nationalism and the erosion of democracy and public trust around the world.”
The writer spells out very well the problem, but unfortunately within the system there is no solution. The capitalist system works according to its own laws and rules and as long ago as Karl Marx, it was clear than the concentration of wealth is an inevitable product.
The ‘market’ system globally is now engaged in a massive and unfettered shift in wealth and income from the less well off to the already very well off. Wealth and income are flowing upwards. It is a finished recipe for social upheaval and political earthquakes. ‘It is not Marxists who prepare revolutions’, as someone pointed out, ‘it is capitalism’.
It is important to take into account that, those politicians who determine the rules of taxation and the division between public and private wealth are overwhelmingly in the pockets of the wealthy. This also goes for the media that feeds the population with lies and pap to hide the real state of affairs.
Indeed, it could be argued that the most important weapon in the hands of the billionaire class is secrecy, and their control of the media. If the mass of the population knew what they got up to and how they bought politicians and dodged laws taxes, they wouldn’t last a week.
The rich would give up part of their wealth if they risked losing all of it
The article in the Finanical Times argues for higher taxation and windfall taxes on the wealthy and on big corporations. But that will not happen. The only motivation that the rich and super-rich would have to relinquish some of their wealth in the future will be the fear of pitchforks.
They would gladly give up part of their wealth, if there was any serious threat that they may lose all of it. ‘Reform’ is a by-product of revolution, or at least the threat of it. But even giving up part of their wealth, the rich would seek to claw it back at the earliest opportunity.
Human civilisation has the material and technical capacity to satisfy all the basic human needs of the entire global population, even while mitigatiing the effects of climate change. But that is only possible if the rich and powerful like those at Davos are completely expropriated and their material wealth – the factories, businesses, land and assets that they control – are utilised in a democratic and planned way for the benefit of all. There are no ‘half-way’ measures that will suffice.
The social and political upheavals about which the Davos crowd fret are indeed beginning to accelerate. Capitalism on a global scale is in crisis and it is increasing levels of resentment, anger and opposition by the day. As someone once said, ‘it is not Marxists who create revolution, it is the capitalist system’.
The longer the twenty-first century progresses, the more it will be revealed as a period of wars, revolutions and counter-revolutions, with sudden and dramatic changes in the national and international landscape. It is not a foregone conclusion, however, that the workers’ movement will find within its organisations the necessary clarity, leadership and sense of purpose to navigate a positive way out of the chaos that will ensue. It is the role of Marxists and socialist activists within the labour movement to do our best to ensure that.
