July 2008: Divide and Fail, Unite and Win

With élites united and majority split, inequality worsens
July 1, 2008

The world’s wealth and resources are being more inequitably distributed than ever before. IBM’s latest Global CEO Study disclosed that the combined income of the 1,130 top executives surveyed in 2007 was $2.224 trillion—an amount higher than the GDP of the entire continent of Africa. Eleven hundred CEOs wallow in more cash than 900 million Africans.

According to Forbes magazine, the CEOs of the 500 biggest companies in the U.S. got a collective pay raise last year of $7.5 billion, or an average of $15.2 million extra on top of their regular pay.

Here in Canada, the income gap also keeps widening, with the highest 20% of families now owning more than 70% of the country’s net worth and the poorest 20% owning just 2.4%. More than 17% of Canada’s children—over a million of them—still live in poverty, a rate worse than in 18 other OECD countries.

This widening inequality is not happening because of a financial shortage. Canada’s economy is generating more than twice as much money today—in real inflation-adjusted dollars--than it did in the 1970s. Per capita GDP was $17,693 in 1970, and by 2005 had more than doubled to $36,077. So the money is there. Piles and piles of it. The problem is with the outrageously unfair way it’s being shared.

The key question this unjustified disparity raises is this: why is it allowed to continue? After all, the super-rich number in the thousands, the rest of us in the millions—and globally in the billions. Why do we keep tolerating such a horrifically skewed allocation of wealth—and the appalling misery, poverty, illiteracy, unemployment, preventable diseases, and other afflictions it spawns? Why do we allow the minority to exploit and abuse the majority?

The answer has many facets, including the dominance of a global economic system driven by greed and the subversion of real democracy in most countries, but the core explanation is that the powerful and affluent few are united while most other people and their organizations are divided.

One of the key strategies of any ruling minority is to prevent the majority from coming together. As long as the separate groups can be induced to pursue their own narrow objectives and even bicker among themselves, they will never unite against those who prey on them.

Canada’s ruling class is applying this divide-and-conquer strategy with remarkable ease and effectiveness.

The first step was to convince most people that the concentration of wealth and power in the hands of a privileged few was a natural, unavoidable, even desirable development. This is how the free market system is supposed to work. In the economic jungle, the strongest and most ruthless predators get the largest shares.

The second step was to convince most people that economically they are in a zero-sum situation in which some groups and individuals can only get more if others get less. So more money for child care means less for health care, more for housing means less for education, more for environmental protection means less for pensioners, more for culture means less for the poor and homeless. (This alleged scarcity, of course, is a myth, but many have come to believe it.)

Individuals, too, are encouraged to see everyone else—even neighbours and co-workers—as rivals for a piece of the shrinking economic pie. If their government, their union, their advocacy group can no longer be depended on for help through collective action, people will come to feel that they are on their own—that the only way each of them can survive in these “lean and mean” times is by outdoing, outwitting, and outclawing their fellow citizens.

All of which plays into the hands of the élite minority who control our economy and suck up most of its wealth. They don’t have to worry about the anger of disadvantaged groups as long as that anger is diffused and fragmented.

Even if the various groups don’t openly compete for the crumbs that fall from the tables of the rich, they serve the same purpose as long as they don’t unite. If, for example, the health care groups focus solely on saving Medicare, the environmentalists on cleaning up the air and water, the anti-poverty groups on helping the poor, and so on, they will all be striving for laudable purposes; but they will still be playing the no-win zero-sum game that has been foisted on them.

It doesn’t have to be this way. There is no real shortage of financial or other resources. A more equitable distribution would permit this country to resume its long-interrupted march toward a truly just society.

But that’s not going to happen as long as most Canadians and their organizations allow themselves to be divided on the basis of different concerns and priorities. The fact is that all our social, economic and ecological problems have a single origin. They are all caused by the unbridled greed of the powerful oligarchy we have permitted to take control of our economic and political systems. Unless we unite and pool our resources to fight that common foe, our separate goals will be thwarted and our shared vision of a better world unfulfilled.

(Ed Finn is the CCPA’s Senior Editor.)