Oxfam argued, back in January of 2015, that sometime in 2016 the top 1% of the world’s population would have more than everyone else. Here’s the study, if you want to follow the math. According to the folks over at therules.org (see their awesome video on global inequality) the global 1% only has 43% of everything. (The difference here is in the methodological noise and, in any case, good data is hard to get. As inequality scholar Branko Milanovic politely noted in The Haves and the Have-Nots, his excellent 2011 book on global inequality, the super rich don’t actually like to be studied.)
Oxfam is sticking to its own numbers. In a new (2016) study, An Economy For the 1%: How privilege and power in the economy drive extreme inequality and how this can be stopped, it argues that the 50% line has now been crossed. I’m going to trust them on this, because their data is from Credit Suisse, and who (what?) better than a Swiss bank to study “ultra high net worth individuals.” An Economy For the 1% is an interesting read. It goes on from the numbers to talk about the nuts and bolts of global stratification, tax havens in particular, and to connect the dots. And to continue its projections:
“If this deeply alarming inequality clock continues to tick as fast, by 2020 a mere 11 people could have the same wealth as half the world. That’s not even a dozen.”
A discouraging story, but not entirely. Back in January 2015, it seemed that nothing could ever change. Here where I sit, in the US, that fog has blown away as the political crisis (also known as the Presidential Election) has jelled. Not just Trumpism, but also the larger disaffection, and a strange new honesty. Just last week, on the evening news, I saw conservative political scientist Charles Murray say that the (white) working class has a lot of “legitimate grievances” against “the ruling class.”
It almost wan’t even surprising.
You already know this story, but there’s an aspect of it that deserves more attention. To wit, highly stratified societies do not function well, in a thousand different ways. In effect, extreme inequality is a social poison. For a canonical discussion of this, see The Spirit Level: Why Greater Equality Makes Societies Stronger, or just take a look at this graph (which I stole from a permabear investment newsletter):
The red line here plots Republican / Democrat cooperation, as measured by the polarization of voting patterns in the House of Representatives. It’s not a perfect proxy for US political dysfunction, but it will do for the moment (see here for the details), and it doesn’t require you to buy into any sort of fake left/right symmetry (as if the Democrats were equally responsible for the state of the American polity) to see just how strong the correlation between inequality and political dysfunction can be.
Nor do you have to be American to see how dangerous the situation is becoming. The political-economic and cultural stress is reaching terrifying levels all over the world, and we haven’t got a chance of managing it – and getting past it in one piece – without inclusive economies and well-functioning governments. Capable governments that are able to plan, effectively and well. Governments that can plan infrastructure transitions, or at least repair bridges. Governments that protect the weak from the winds of globalization, or at least respond when hurricane winds tear their cities. Governments that can pass, and legitimate, progressive tax systems. Governments that, in a world addled by neoliberal ideology, are now rare.
Accelerated planetary warming
The Paris Agreements have been widely praised for their ambition, for formally committing the world’s nations to
“aggregate emission pathways consistent with holding the increase in the global average temperature to well below 2°C above pre-industrial levels and pursuing efforts to limit the temperature increase to 1.5°C above pre-industrial levels.”
That’s the good news. The bad news is that 1.5°C is probably out of reach, and that even 2°C will be very, very hard. And that there’s not a snowball’s chance in hell that we’re going to make it through the greenhouse century without high degrees of resolve and strong institutions of cooperation, institutions that function both internationally and within nations. And given the accelerated pace of the recent warming, that cooperation had better start very, very soon.
Here’s one chart, which can represent many:
This is a chart of global mean surface temperature anomalies over time. It’s NASA data, and is relative to the average 1951 to 1980 temperature. It shows a warming of 1.35°C for Feb 2016 (the red dot). What we want to do here is compare that Feb 2016 number to the Paris Agreements text (just above), the one that says that we will pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels. The complication is that the Paris goals aren’t relative to 1951-1980 period, but rather to “pre-industrial” temperatures. This, fortunately, is an easy correction to make. Jim Hansen (see page 7 in this March 2016 journal article) gives the correction at 0.3°C, which gives us a whopping 1.65°C above the average temperature for the month of February. Which, you will notice, is larger than 1.5°C.
This is only a monthly figure, but it’s on trend. 2016 is likely to be hotter than 2015, which was itself hotter than 2014. And 2015, please note, presented us with an annual (not monthly) temperature anomaly of 1.17°C (or 0.87°C, if you don’t correct to pre-industrial, which you might forget to do if, say, you wanted to make the warming seem smaller.)
For more on all this, see Joe Romm here. It’s a particularly nice discussion, and it focuses on why we can’t just chalk the recent warming spike up to “that El Niño thing” and forget about it. It also allows Romm to to say that his real fear isn’t the high recent global average surface temperatures, but rather Arctic warming itself.)
So February was already warmer than 1.5°C. Which is not to say that the year 2016 will be – it won’t – but very much is to say that something is happening. Something bad. Which is why it’s critical to understand that, while Paris was a big step, that’s all it was. And that the fundamental problems of deep and rapid decarbonization in a high-inequality world are going to make the next steps difficult indeed. In fact, we’re probably not going to be able to take them, not fast enough, unless reducing the polarization is part of the deal.
One final thing
You shouldn’t write anything like this without being worried about being discouraging. Discouragement, after all, is itself a danger, and a big one. But I decided to go ahead, for two reasons. The first is that I don’t see how we can be partially reality based. The second is that I believe that there are still paths forward, albeit only high technology, high cooperation paths.
This means, to me, that we have to face some terrible truths. One of them is that it’s going to take everything to keep the warming below 2°C, including luck. Another is that, even with luck, we’re not going to make it without cooperation, hard and robust cooperation. And we’re not going to get that cooperation in a world where 1% of the people own 50% of everything.
Or even 43%.