[This is an old article that was originally published several years ago. It shows some of the development of our political economy.]
Global Inequality Versus Socialist Equality
An approach to economics centered on equality as a regulative idea is in no way contrary to approaches that center around the mechanics of exploitation. It is not necessarily contrary to the labor theory of value or the theories of unequal exchange. Putting equality at the forefront also does not commit us to the kind of ultra-egalitarianism that Mao Zedong famously criticized. Obviously, there are certain cases where some inequalities are necessary and, even, desirable. It does demand that we act to greatly reducing the gaps between wealthy and poor populations, especially the gaps between the First and Third World. Equality demands the global social product be distributed evenly amongst the world’s population as best as possible.
Some might object that a socialist distribution is not an egalitarian distribution. Rather, a socialist distribution is one where wealth is spread out, not evenly, but to those who do the work and those countries who do the work: she who does not work, shall not eat. Whereas some have argued that the labor theory of value is necessary for explaining the mechanics of exploitation, the distribution principle associated with it is not adequate to rectify the problem of inequality between countries that has been generated by imperialism. Such a distribution principle does not address the problem of underdevelopment. Surely populations in the most underdeveloped parts of the Third World, that have been rendered unproductive by imperialism, should not continue to remain in dire poverty under a global socialism. Whole countries of the “industrial reserve army” in the Third World may not currently be productive, but should not resources and development be directed to such populations under socialism? According to demographers, for the first time in history, the majority of the world’s population is living in cities. The new “global countryside,” the base areas of the Global People’s Wars, will include the slums of Third World megacities. These slums are less sites for production then blights that show just how capitalism’s anarchy of production has failed to bring huge segments of the human population into production. Surely socialism must speak to these vast populations that will be the people’s warriors in the decades to come.
The global economy is a causal nexus where value in various forms is transferred around the globe from one person to another. So, if one person is receiving more than an equal share, then somebody else is receiving less somewhere in the causal nexus. Likewise, if someone is receiving less, someone else is receiving more. Imperialism has created a world order where those who receive less and those who receive more correspond to populations in the Third World and First World respectively. Using equality as a regulative idea, one should be regarded as exploited when one does not receive an equal, a fair, a just share. One is an exploiter when one receives more than an equal, a fair, a just share. A country or region is exploited, is part of the Third World, when its population is largely made up the exploited who have less than an equal share. A country or region should be regarded as part of the First World when its population is largely made up of exploiters who have more than an equal share. (1)
A quick look at global inequality
The income gap between the wealthy, imperialist countries and the poor countries of the global countryside points to the tremendous parasitism of the former on the latter. The income gap between the fifth of the world’s people in the former and the fifth in the latter was 74 to 1 in 1997, up from 60 to 1 in 1990 and 30 to 1 in 1960.
Now, all of the population of the First World are in the world’s richest 20% by income, which owns more than 85% of the world’s wealth. But if more than 50% of the world’s assets are own by the richest 2% of adults (most of whom live in the First World), the First World majority (less than 20% of the global population) owns 35% of the world’s wealth. 80% of the world’s population must make do with owning 15% of the world’s wealth. This First World monopoly of assets translates into a hugely disproportionate share of world consumption. In the 1998 study cited, 20 percent of the population in the developed nations were reported to consume 86 percent of the world’s goods. This astonishing degree of parasitism is underscored by a more recent 2002 World Bank study that reports that the richest 50 million people in Europe and North America have the same income as 2.7 billion poor people. (2)
After decades of “development” and market liberalisation, structural adjustment programs and Washington Consensus neoliberalism, the average income for the Third World is still only around 15% that of the First World in purchasing power parity terms, and more like 5% in foreign exchange rate terms. (3)
Parasitism is reflected in consumption also. The fifth of the world’s people living in the highest income countries consumed:
86% of the world’s GDP – the bottom fifth just 1%.
82% of the world’s export markets – the bottom fifth just 1%.
68% of foreign direct investment – the bottom fifth just 1%.
74% of the world’s telephone lines – the bottom fifth 1.5%.
93.3% of internet users – the bottom fifth 0.2%.
84% of the world’s paper – the bottom fifth 1.1%.
87% of the world’s vehicles – the bottom fifth less than 1%.
58% of total energy – the bottom fifth 4%. (4)
The majority of the increase in world consumption during the 1990s accrued to those already in the top 10% of world income distribution. Between 1993 and 2001, some 50 to 60% of the increase in world consumption accrued to those living on more than PPP$10,000 1993 – around 10% of the world’s population. For this 10%, 4/5 lived in the high income countries and most of the rest in Latin America. The remaining 40-50% of the increase in world consumption accrued mainly to those living on around PPP$3000-$6000, of whom the majority were in the burgeoning middle class of semi-comprador China. “Hardly any of the increase accrued to those on less than PPP$1000 a year ($2.73 day). Most of the latter lived in South Asia, Africa, and China.” (5)
The First World worker does not gain under an egalitarian distribution of the world’s wealth. If a socialist order existed between peoples and regions, it is impossible to ignore the fact that the First World populations as a whole would lose out in terms of income, assets, life opportunities, etc. Thus the First World worker has little interest in overthrowing the status quo in favor of socialism, in favor of equality.
The revisionist script is a predictable one. Whether the revisionists choose to justify or explain these global disparities in wealth according to “productivity” differences or the protestant work ethic, manifest destiny, white racial superiority or predestination makes not one whit of difference. Like other imperialists, First Worldist revisionists will do all sorts of ideological contortions to justify the current standard of living of First World “workers. ” Not only do they maintain that the current imperial standard of living in the First World is deserved, but that First World workers deserve even more of the global pie. Karl Marx would be spinning in his grave, Lenin too, if they were around to hear these scumbags justifying parasitism in their names. Reality matters. Theory has to match reality, it must predict and explain, it must be scientific if it is to be a guide to action. Leading Light Communism is a set of eye glasses whose lenses allow the masses to see the world as it is. We can stumble around blindly or we can choose reality, revisionism or Leading Light Communism.
- In value terms, it is true that the poorest people in the world are often those who are unable to find work and, hence, are not technically exploited. But since exploitation has taken on profound geo-political dimensions after World War II, if a group of people lives in an exploited nation (a nation which turns over the bulk of its surplus value to the First World) and is paid below the international value of labor, then it is exploited and its lumpen status ensures competition for wages drives down their value in their country, contributing to superprofits.
- United Nations Human Development Report 1998, ‘Consumption for Human Development’ (United Nations Development Programme (UNDP), New York 1998) online: http://hdr.undp.org/en/reports/global/hdr1998/
- Robert Hunter Wade, ‘Globalisation, Growth, Poverty, Inequality, Resentment, and Imperialism,’ in John Ravenhill, (ed.), Global Political Economy (Oxford University Press, 2008), p. 378.
- United Nations Human Development Report 1999, ‘Globalization with a Human Face’, (United Nations Development Programme (UNDP), New York 1998) online: http://hdr.undp.org/en/reports/global/hdr1999/
- Wade, 2008, p. 380.