Perched at the very top of an iniquitous global economic pyramid, the world's financial elite are nothing more than parasites leeching off the lifeblood of the world's poor and middle classes, writes Glenn Ashton. While the hold on wealth and resources of the top 20 per cent is deeply concerning, the power of an elite 1 per cent is simply perverse, Ashton stresses.
Wealth is relative. Anyone with enough to eat and a house to live in is rich. If you are reading this you are probably rich.
Around 80 per cent of people live on less than US$10 per day. The top 20 per cent consume around 75 per cent of the world’s goods. The elite, upper and top half of the middle class constitute no more than 10 per cent of the world's population, yet control nearly 60 per cent of global wealth.
Despite global promises to achieve greater equality, we are living in a world that is becoming ever more economically polarised. The rich become gleefully richer while the poor majority remain mired in an inescapable morass. The middle class is squeezed between the two.
The upper one per cent, those inhabiting the economic stratosphere, constitute a global financial elite. They control a disproportionate share of the world's wealth. It is estimated that global dollar billionaires, numbering around 1,000 individuals, account for more than 7 per cent of the world's gross domestic (GDP). The top one per cent, according to the Helsinki-based World Institute for Development Economics Research of the United Nations University, own 40 per cent of the world's wealth.
This global elite are portrayed in the media as an ideal to aspire to. What else is Paris Hilton but the name of a hotel owned by her father? It is only the perverse focus of a sycophantic media that has turned this ditzy bint into an icon.
The media is largely controlled by the very same global elite, consequently projecting a self-serving worldview. Nowhere is this better illustrated than through the prurient self-interest of the global media empire owned by Rupert Murdoch, specialising in style trumping substance, feeding the populace on a diet of intellectual drivel.
The reality is that the financial elite is the problem, not the solution. The world simply cannot support these perverse, fairytale lifestyles. The unsustainable environmental and economic demands they place on our increasingly limited resources undermine any positive contribution they may offer. Financial elites constitute nothing more than parasites feasting on our collective lifeblood.
The fact that some 8 million people control over 25 per cent of global assets epitomises the perversity of this situation. More worrying yet is the fact that this wealth continues to gravitate upwards, stripping away the limited wealth of the middle and lower classes.
The middle class is really the jam in the sandwich, stuck between the wealthy and the poor. They provide much of the expertise and hard work to facilitate economic activity, yet are constantly squeezed, by the tax burden on one side, and by inflationary pressures on the other.
The middle classes are prone to proportionately far higher levels of taxation than the ultra wealthy. The economic elite employ an army of advisers and investment brokers to multiply their wealth on the one hand with inordinate amounts to avoid taxation on the other. They have evolved into a vampire-like anti-social parasite, feeding off an ailing host.
Their wealth has to come from somewhere. Generally, it is made on the backs of the poor and middle classes, just as has been the case throughout history. But given the increasing global population and the limits to growth we face, this situation is no longer sustainable.
Inflation is largely the product of predatory corporate profiteering. This is largely overlooked by economists in the mainstream media, controlled as it is by the interests described above. The lie of trickle-down economics is contradicted by the reality of economic exploitation, where the rich continue to get richer while everyone else becomes poorer.
Even during the most recent global economic downturn – which was actually the systemic failure of oversight mechanisms to manage the global economy – the rich continued to accrue wealth. While there was a brief drop in the number of actual billionaires, the number recovered sharply and the actual proportion of wealth owned by this sector continued to increase.
This is all far more obvious to those of us living in the global South. Given that most wealth is concentrated in developed nations, this is unsurprising. The daily flaunting of conspicuous consumption by the economic super-class is a collective challenge that spurs instability, especially in profoundly unequal nations like South Africa and Brazil.
My home city, Cape Town, has recently been discovered by this vampire elite. We now see houses owned by the corrupt African oligarchs from Equatorial Guinea and Angola perched alongside those of the no less reprehensible members of the Western economic elite they seek to mimic, seeking yet another fashionable place in the sun. Ostentatious mega-yachts equipped with submarines, helicopters and all the accoutrements of these parasitic classes bob in our marinas.
We really need to question precisely what value these financial vampires actually contribute to the world, or even to our local economy, for that matter. The claim that employment is created and services rendered by the casting about of excessive wealth and largesse again echoes the discredited theories of trickle-down economics. If there is any benefit to hosting parasitic invaders, it is apparently no greater than that of hosting any other upper-middle class plebeian.
The reality is that the advisers and investors employed by these economic parasites actively hide this wealth from prying eyes. Taxation is avoided at great cost to national economies. Money is secreted in tax havens; corrupt, poxy-little proxy states like Belize, the British Virgin Islands or the Turks and Caicos Islands, or perhaps in rather more respectable financial 'superpower' nations like Panama, Liechtenstein or Uruguay. What may be legal is not necessarily moral.
Instead of ethically sharing these vast fortunes, they are sequestered in search of the highest returns. One such favoured vehicle is derivatives, described by über-investor Warren Buffet as 'financial weapons of mass destruction'. Derivatives fleece the global financial system while benefiting only speculators.
Taxation is a democratically agreed upon and managed means of transferring excess wealth to those with insufficient resources to cope. The extent to which this vampire class is fixated upon avoiding and evading any form of taxation is symptomatic of the extent to which the system has become broken, largely through their focused interventions.
This dynamic creates pressure upon the 'lower' classes through the mechanism of diminishing available resources. The geographical proximity between the poor and the middle class exposes the latter to a far higher degree of criminality than the ultra-rich, who insulate themselves through high levels of security or geographical isolation. Equally the poor turn upon themselves as the middle classes echo the behaviour of the ultra-rich, enclosing themselves in virtual jails to prevent the encroachment of reality.
Instead of redistributing this wealth through legitimate taxation, the financial elite divert criticism by 'investing' into pet projects. Significant resources are diverted to lobby for lower tax rates, for opening global financial markets and other self-interested interventions.
Philanthropy is directed according to personal whims. While some may be neutral, there is an increasing trend to supplant mandated international oversight by imposing privately funded, high input, technological approaches to systemic problems such as those touted by the Gates–Buffet foundation in Africa, where high input agriculture is being pursued as a solution to hunger. The end result is that instead of money being placed under democratic control it is redirected into ideological projects that override the democratic mandate and international institutions of governance, such as the United Nations.
The social analysts Richard Wilkinson and Kate Picket of The Equality Trust emphasise that unequal societies cannot remain stable, secure or enjoy a decent quality of life. Interestingly, the USA – the richest nation on earth – is also one of the most unequal societies.
While the USA is romanticised as a place where one goes to seek their fortune, this is only because of selective perspectives projected by the elite-controlled media. The American reality is as ugly as some of the worst inequality on earth, comparable to deeply unequal developing nations like Mexico, Brazil and of course South Africa.
The time is overdue for the excesses of the parasitic ultra-wealthy to be reined in. While this tiny minority has managed to hang in there for an awfully long time, there is no longer any place for this disconnected elitism in an increasingly connected world that increasingly shifts toward more egalitarian value systems.
BROUGHT TO YOU BY PAMBAZUKA NEWS
* This article was originally published by the South African Civil Society Information Service.
* Glenn Ashton is a writer and researcher working in civil society. Some of his work can be viewed at www.ekogaia.org.
* Please send comments to [email protected] or comment online at Pambazuka News.