Andrew Sheng

Opinion | The world needs a summit to tackle climate and wealth inequalities

The latest World Inequality Report highlights the historical and political roots of income and wealth inequalities and their correlation with climate change

The least we can do is have a dialogue on how those who can afford to and who emit more carbon should pay higher taxes to foster a more inclusive world

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Activists from Amnesty international, Emergency and Oxfam stage a flash mob demonstration to denounce global vaccine inequalities, on October 29 in Rome, on the eve of the G20 World Leaders Summit. Photo: AFP

Andrew Sheng

Published: 1:30am, 18 Dec 2021Updated: 4:10am, 18 Dec 2021

Life is unfair but what can we do about it? The world continues to tolerate the growing injustice of inequalities in income, wealth and, most recently, vaccine distribution.

French political economist Thomas Piketty and his colleagues at the World Inequality Lab has just published the World Inequality Report 2022, a gold mine of data and insights. I found at least three nuggets.

First, inequality is primarily a political issue. We can all do something about it, but since politics has been captured by money, the few remain more equal than the many. Between 1995 and 2021, the wealthiest 1 per cent captured 38 per cent of the growth in global wealth, whereas the bottom 50 per cent had a pitiful 2 per cent share.

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Similarly, the richest 10 per cent take home 52 per cent of the global income, whereas the bottom 50 per cent earned only 8.5 per cent of it.

The report showed why these inequities could not be reduced despite increases in average income and wealth per capita. The progressive tax rates where the rich paid more than the poor, introduced in the first half of the 20th century to deal with inequality, were dismantled in the 1980s.

The neoliberal free-market philosophy preached low taxes and small government to encourage entrepreneurship, but effectively handed more income and wealth to the elite.

Piketty’s second historical insight is that Europe, and later America, got rich on the back of the Industrial Revolution and colonisation. In 1820, inequality between countries made up only 11 per cent of global inequality, meaning most of it was domestic.