Even it up! is the new campaign from Oxfam international that launched last week. It follows their research earlier this year that showed that 85 people have as much wealth as half of humanity. 7 out of ten people people live in countries where in-country inequality is rising. As Oxfam argue, this is not inevitable.
It’s hard to escape the issue of inequality at the moment. There’s a rising recognition that letting the gap between rich and poor endlessly run has consequences. More and more people are getting that, but so far there’s been far more talk than action. No political party has really taken hold of the issue, despite the upcoming election. It still feels under-reported, crowded out by angrier but arguably far less urgent issues. I feel like we’ve been waiting for a campaign that kicks the debate a step further, moving from tutting about injustice to looking at what can practically be done about it. Perhaps this is it.
I’ve downloaded the new report to read on the train this week. In the meantime, here’s the introductory video:
The Earthbound Report 
Reblogged this on matt's musings .
Even it Up – Brilliant little video. Good on you Oxfam!
Oxfam love the misleading equivalence. For example they say ” a tax of just 1.5 percent on the wealth of the world’s billionaires, if implemented directly after the financial crisis, could have saved 23 million lives in the poorest 49 countries by providing them with money to invest in healthcare”. Now if we taxed those people wouldn’t it be likely that the voters in the rich countries that did the taxing would want that money spent on their schools and hospitals?
Another sleight of hand is to list the problems caused by in-country inequality (for which there is a balanced academic debate as to its economic effects)and then give the impression that an attack on global inequality (which is falling and not seen as such a problem by economists) via a tax on billionaires would solve the problems of the developing world.
Experience shows you need to be careful with figures Oxfam produces, they exaggerate and get confused. In this report they decry tax evasion via transfer pricing and refer to a previous report. But as Maya Forstater (ex NEF) shows this is a confusion with other figures. http://www.ictd.ac/en/corporate-tax-avoidance-and-development-opening-pandora%E2%80%99s-box
Now I know some people here think facts and figures are hard and unimportant but it is vital to get them right or you end up with policies that harm those you want to help.
The 1.5% tax on billionaires is a hypothetical device to illustrate the problem, not a recommendation. Global taxes get a brief passing mention as a possible future development, but are in no way elaborated as a solution. How could they be, without a global government to collect them? So no, it’s not remotely sleight of hand.
Neither is there any attempt to mislead over in-country and between-country inequality. The report is perfectly clear about that right at the start. “Between 1980 and 2002, inequality between countries rose rapidly reaching a very high level. It has since fallen slightly due to growth in emerging countries, particularly China. But it is inequality within countries that matters most to people, as the poorest struggle to get by while their neighbours prosper, and this is rising rapidly in the majority of countries.”
Yes, no doubt there are contested figures in the report. There are very few uncontested statistics, especially on unmeasurable things like tax evasion. It’s all footnoted and you can go and look up all the references.
This is a good report that challenges many of your assumptions about inequality and what can and can’t be done about it. I wish you would put aside the dogma for a moment and actually engage with its arguments.
And here is my reply to DevonChap – Have you got your facts right? Do you dare to say that ‘some people here’ think facts and figures are hard and unimportant? Who are these people? In case you have me in mind, I must clarify – I, for one, would always say that correct facts and figures are hard to come by which is a pity because they can be important if only we could get to the bottom of them. As it is, exaggerated or disputed, they do not serve anyone, or change our fundamental beliefs, as they and their interpretation cannot be verified by most people, and past example belongs to the past since people today have more potential to make change happen. By daring to point the finger at some people here, I think you’ll find you have merely pointed it at yourself by getting it wrong! You have proved the point you wish to criticise.
Put simply, ‘some people here’ think it would be better in the long run for society to share the earth’s wealth more evenly and it seems you do not agree. So why bring it down to arguing the type of facts and figures which have already been shown to get us nowhere.
Regarding your link to Maya Forstator, she concludes that we can negotiate to develop institutions and systems to enable healthier and more prosperous societies but we are a served better if we have the best information to guide us. I’m sure we all think the same, so there’s nothing new there and like other contributions, it gets us no further in proving the facts and figures or changing our fundamental beliefs.
Facts are very hard to prove, and even harder to understand. But they are vital. What can change your fundamental beliefs if not facts as you experience then in life or intellectually.
You seem to object to me quoting figures, suggesting they are unverified. Who do you suggest could verify them, what ultimate source of knowledge is there.
As to your contention that the past is no guide to the future. That is rubbish but to show you would mean looking at past examples of occasions when people said “this time it’s different” which you won’t accept since you say “this time it’s different”. You have created a circular argument.
No. Again you have misrepresented me. I said times now are different because we now have much greater knowledge and communication available to us (eg power). No tautology at all.
Facts are invaluable but as I said, life does not let us experience the TYPE of facts and figures that so much time is wasted over by squabbling about them.
I have also written to Oxfam to see if/how they reply to the allegation about their ‘facts’.
While we may have more power we are still the same wonderful selfish brave cowardly generous status seeking humans we have always been which is why attempts at New Jerusalems have failed in the past and will fail again.
Looking at the academic debate, using papers quoted in this report, there are two key concepts. One, growth, the growth from our globalised world, has been very good for reducing poverty. And second that where inequality is a problem it is extreme inequality, where the difference in living standards between the rich and the poor is immense. This rules out most developed nations having much of a problem.
Oxfam do make some good points. They raise people such as Carlos Slim who became the world’s richest man through control of Mexican telecoms from their privatization. But the issue was not the privatization but the corrupt links to government that prevented competition. Oxfam don’t seem at all keen on opening markets up that would make the Slims of the world poorer while lowering prices for the poor.
Oxfam’s solutions seem rather proscriptive with little evidence. They are very statist, demanding that private provision be removed from health and education.
There is very little discussion about growth to fund the social spending. There is no talk of trade except exempting health and education from trade agreements. In terms of tax they suggest a tax on capital wwhich most economists think harms the growth that lifts the poor from poverty.
Not everything is bad. A focus on education and health is a good thing, as is women’s rights. Sadly again the prescription is off.
Let me quote you from our debate last week: “focusing on inequality isn’t the problem, it is poverty. Tackling inequality, especially in the way lots of people you link to like, would damage the economy and make the poor poorer.”
This report and the papers it quotes rubbishes that view entirely.
Inequality holds back progress on ending poverty, and stunts economic growth. Those findings are from the World Bank and the IMF respectively, not from Oxfam.
Yes, the area of prescriptions is where more work is needed. But you need to update your views on whether or not inequality matters.
You missed the vital word – extreme. According to the World Bank & IMF extreme poverty slows growth. Important point to make, not to miss.
And my point that the ways lots of people would tackle inequality would make poverty worse is absolutely demonstrated in this report.
No, I didn’t miss the word. (Oxfam use it carefully too, I note.) But countries tending towards greater inequality are on their way to extreme inequality – that’s the inevitable endpoint of that growing gap. And that’s why I’m interested in ways of sharing growth better through predistribution, so that we don’t end up in that situation of extreme inequality.
DevonChap, you must surely want to eradicate all degrees of poverty? Have you ever said how you think it should be tackled?
I have many times said I want to end poverty and the way to do it is by growing the economies of the rich and poor countries alike. This is what has lifted hundreds of millions out of absolute poverty over the last 30 years. So I want more free trade, more global capital investment and markets to be opened up internally and externally. The wealth that generates allows people to work their way to a better standard of living and welfare programmes to help those left behind.
Poverty is the problem that exercises me, not inequality. That doesn’t make me unfeeling. Results matter more to me than moral posturing.
DevonChap, I’m sure it’s not at all about being unfeeling or moral posturing. I had forgotten that growth is the basic issue. Some think we must stop seeking further growth as we are already exceeding the earth’s limits and your group think we will learn how to grow more but use less. Thanks for the reminder.
Growth is important in poor countries, but it has to be inclusive growth – hence the focus on inequality. To use the example in Oxfam’s report, GDP growth in Zambia was 3% a year for a decade. According to DevonChap’s beliefs, poor people should have been lifted out of poverty. Instead, the number of people living on less than $1.25 rose from 65% to 74%. Why? Because all the growth had gone to the elite. So you can’t separate poverty and equality. Those who say you can aren’t paying attention.
Exactly the same thing is happening in Britain, at a less extreme level. The economy is growing, as the government like to regularly celebrate. But inflation is rising faster than wages, and so most people are getting poorer in real terms. Why? Because the richest take the biggest slice of the growth. So inequality matters, and there’s no way around it. It’s just free market dogma to keep on saying it’s not a problem.
The long term solution is not to stop people getting rich, nor is it to take money away from rich people and give it to the poor. It’s to create a much more inclusive economy where people have a stake in our success as a nation, and where nobody is left behind. Why is that so controversial, and apparently too much to ask?
Jeremy thanks. You ask why that it so controversial and apparently too much too ask and I believe the answer is that we acome back to our human nature being one of fundamental fear. if we are in a family/clan we see the benefits of supporting each other but when we become so distanced from each other (as modern living has encouraged), we do not see so well and fear takes a greater hold. Therefore we compete more. This is added to the fact that we can become habitualised into adding more and more to whatever we value, money being an ovious choice, especially when you’ve started on that road early or rarely stop to think that even money is from the earth’s resources and that has consequences for all, both short term and long.
This is my instant reply – not something I often give, but I am more confident in this area. I hope it contributes usefully.
A big part of why Zambia’s poor didn’t keep up is population growth.
The trouble with lots of ‘inclusive’ economic policies is that they will retarded the economy so that the growth the average/poor feel is less than they do under an unequal system. For example the pushing for the Living Wage will increase unemployment. So those who keep their jobs gain at the expense of their ex colleagues.
DevonChap, I know it’s not easy to define broad concepts with brevity and I assure you that I’m not after an economic lesson, but, could you try to further define ‘inclusive’ policies as opposed to an ‘unequal’ system which you apparently are doing. I understand if this is asking too much of you.
I just can’t understand why someone would not want an economics lesson 🙂
The inverted commas are there because you can’t just go ‘inclusive and wrong’, ‘unequal and right’. My point is that sadly it seems to me that most people who rank inequality as their high issue favour policies that while seemingly favour equality, either harm the goal of poverty reduction or just move inequality around. Such as my example of insisting on ‘living wages’ making a substantial number of people worse off through increased unemployment. Or subsidies for food or fuel. These tend to favour the better off and bankrupt the state – cash transfers to the poor are better
There are policies that are both inclusive and economically good, such as widening educationprovision. But what you shouldn’t do is insist that it is provided for by the state and not funding private provision where appropriate (Oxfam’s view) since that can be bad economically too (The Indian school system with its absentee teachers is a good example). What is important is the outcome, not the route taken.
@DevonChap. You said ‘What is important is the outcome, not the route taken.’ Can I take it that you also believe it is the end and not the means that is important in all things?
That is a general question but more specifically, would you not say that, generally speaking, the less equal a society is, the more we see incidences of some social ills, such as drug and alcohol abuse, depression, prison population and teenage pregnancy? Is it possible to answer ‘Yes’ or ‘No’ (!), after all, I’ve only asked for an answer generally speaking. Obviously, not so easy for my first question, so I’ll let you off Yes/No on that one! Thanks.
I don’t believe the end justifies the means in all cases. That thinking has led to many horrors in history.
I don’t think necessarily more unequal societies have higher social ills. Many of those ills are from cultural issues present for a long time. Poverty causes worse ills which is why I want to tackle that in the most effective manner.
It’s false to say the problem is just poverty. It’s equally false to say the problem is inequality. They have to go together, because without keeping an eye on distribution, growth may or may not be lifting people out of poverty.
Karen, DevonChap will tell you that unequal countries don’t necessarily have higher social ills. He’ll also roll his eyes at the link I’m about to post – but have a look and decide for yourself: http://www.equalitytrust.org.uk/resources/spirit-level
Thank you both so much and here it is, my eventual conclusion to what bothered me.
From everything I have seen, I can deduce that inequality increases social ills and it needs to be fought on many fronts because there are many causes of inequality. Some policies designed to reduce inequality can result in more poverty (and possibly increase the degree of poverty for some?). Therefore, the ability to work out the trade-offs is required in policy making.
From this, it now seems to me that DevonChap and Jeremy often argue over details which are not dealing with the question of trade-offs which is really where the argument should be directed, and this is why I sense that their arguments resolve nothing properly.
If either of you can progress my thinking I would be eternally grateful.
(Jeremy, you forgot to use my alias last time – I expect you were in a hurry).
(DevonChap, I’d like to know your profession but suspect that’s secret?)
Sorry Dichasium, I will refer to you as such in future!
DevonChap is quite right to point out that some actions to reduce inequality can lower overall wealth, but that doesn’t mean we do nothing. It’s a bit like climate change, in that there are many proposed solutions that could actually make things worse. That’s no reason not to act, just to be smart about how we act, and not rush into quick fixes.
Like climate change, there are those who continue to insist that inequality isn’t a problem, despite growing evidence that it is. Much of that evidence is pretty new though, so it’s not surprising that there is a bit of a lag. The issue has been polarising in the past, and it is only slowly breaking out of the ‘left’ box where it had been safely placed.
One of the great things about the inequality debate is that is has broadened so much in the last few years. Those arguing for greater equality used to be on the left, usually with re-distributive arguments. That’s no longer the case, with big institutions like the IMF or the World Bank taking it seriously, because there’s just so much evidence now that it is harmful, economically and socially. Even those that would have resisted any talk about inequality, such as the Economist or the CBI, are now a constructive part of the debate.
That diversity of voices means a broader range of solutions, and makes it much more likely that we can make good decisions about how to address the problem.
Thanks Jeremy. It’s good to hear that people may be beginning to see/accept that inequality ultimately affect everyone detrimentally.
I’m sure DevonChap’s intention is also to try to improve good decisions, though I still shake my head at throwing conflicting data back and forth as it never seems productive. He says he prefers to tackle poverty but, I imagine, the same issues must present themselves there too, so it’s not clear why he has this preference. Perhaps, I should ask for that too, but I am concerned about being a nuisance. Maybe he’ll read this and offer a response.
I’m pretty sure global inequality is actually getting worse, which is why they’re doing this campaign. And just because (most) economists don’t think it’s a problem doesn’t mean it isn’t one!
I do however agree that people would want the tax from their countries to be spent on public services for that country, before others. But a) very rich people are found all over the world, even poor countries have millionaires – although not as many of course. b) rich countries can help poorer ones with methods other than aid, such as green technology transfer, writing off old debts and changing trade regulations to make them fairer. b) some small proportion could be given as aid though, especially from countries that already have it sorted when it comes to public services.
I’m all for progressive taxation, I think in this country those on low incomes pay too much and the very richest don’t pay enough. But what’s even worse is corporate tax evasion and loop holes.
The inequality in the world is sickening – we can’t possibly call ourselves a civilised species when such a large proportion of us still live in abject poverty, despite all the progress we’ve made.
DevonChap – I don’t know if this is of any interest to you, but here is Oxfam’s response to the matter you mentioned:
‘Just to clarify that the Even It Up animation didn’t have any figures about corporate tax that relate to the findings in the ICTD blog you forwarded. In the video we talk about a 1.5% tax on billionaires, just as a indication of how far a very small tax on billionaires could go to filling the financing gap on healthcare and education (for e.g.) to help illustrate the scale of wealth inequality in the world today.
But with regards to the use of statistics in our broader tax work, we are aware of Maya Forstater’s work and have discussed directly with her. We all agree that NGOs are in a difficult place where they are asked to illustrate the scale of the problem of tax dodging, for example, using easily digestible figures/numbers while at the same time facing a huge lack of data/opacity of data. We are also all in agreement that increasing transparency is essential to advancing tax justice, hence why we advocate for measures such as country by country reporting.
With any statistics that estimate the scale of the problem of tax avoidance, for example, we try to use language to indicate that these are only educated guesses, or estimations of a reasonable range. We also try to update our analysis whenever new data becomes available.
I think it is also important to remember that regardless of the numbers, it doesn’t change the fundamental injustice behind a tax system that favours developed countries, large corporations and wealthy individuals over the public interest.
I found Richard Murphy’s recent blog on the subject of tax statistics very helpful. If you haven’t already seen it, it is here:
http://www.taxresearch.org.uk/Blog/2014/11/06/why-the-ngo-data-debate-needs-to-move-on/ .’
@DevonChap – On this point I think you may well be right. However, for me, I think it is worth a try (I only get one life in which to try, as far as I know), and even if it fails we may get some good things done along the way (whether they could be done on their own or not).