In 1982, Chuck Feeney established Atlantic Philantropies. I well recall the year, but for other reasons. It began with the heaviest snowfall in Dublin in many years. On 28th February this year, three decades on, amid the first snow flurries of “the Beast from the East”, Atlantic Philanthropies closed its Dublin office, one of the final steps in the wind-down of the “Giving While Living” distribution of Chuck Feeney’s $8bn fortune. Today, according to the Irish Times, 86 year-old Feeney lives—by choice—“in a modest rented apartment in San Francisco. He has no car or luxuries of any kind. Actually, come to think of it, he has a very nice watch. It is plastic and cost about $15.”

While Feeney is being hailed for his generosity and foresight, the Harvard Business Review (HBR) published an article entitled: “40 Years of Data Suggests 3 Myths About Globalization.” Unsurprisingly, Feeney is an extreme outlier. In general, economic orthodoxy and national policies have aligned since the 1980s to funnel overall growth in income and wealth to a very small minority of the population worldwide. Feeney’s (and others’) philanthropic efforts are but a minuscule backwash against a rising tide of inequality and accumulation of wealth.

The HBR article is based on the recently published World Inequality Report 2018. The study gathers comprehensive and transparent information about a wide range of economic measures, including: “national income and wealth accounts (including, when possible, offshore wealth estimates); household income and wealth surveys; fiscal data coming from taxes on income; inheritance and wealth data (when they exist); and wealth rankings.” Its author, Lucas Chancel (also a coordinator of the report) offers three conclusions:

Globalization has led to a rise in global income inequality, not a reduction

Income doesn’t trickle down, and

[Governmental] Policy—not trade or technology—is most responsible for inequality

For me, at least, these trends have long been evident and the conclusions obvious.

The report concludes that continuing with “business as usual” will lead only to even greater inequality, with the top 1% of the world population accruing almost 40% of global wealth by 2050 (up from approximately 33%). Meanwhile, the top 0.1% will hold some 25% of global wealth, the same as the middle 40%—the global middle class.

The figures speak for themselves and largely echo the conclusions of earlier US-only studies, with the added value of comparing how other countries have behaved and performed, as shown in Figure 1. European countries, such as UK and France, saw a steady decrease in inequality since the extraordinary concentration of wealth in the hands of the 1% before the first World War, with a levelling off and slight increase since the 1980s. Inequality in the US saw decreases—from a lower starting point—before 1980 due, in part, to the policy changes of the New Deal, but inequality has now returned to levels last seen before the second World War. The only economies that also show growth in inequality—considerably more dramatic than the US—are the former communist countries of Russia and China.

Figure 1: Top 1% personal wealth share in emerging and rich countries, 1913–2015

In a system as complex as our global economy, cause and effect are the subject of endless debate. However, what is notable is that since the advent of widespread growth of globalization, wealth inequality has not shown a consistent trend across different countries, as it did prior to 1980. Governmental policies are the most likely indicators of the direction and extent of inequality.

Of note is the significant and ongoing transfer of public capital to private ownership that has occurred since 1980. Despite a substantial increase in national wealth in most countries, public capital is now close to zero—and actually negative in the US and UK—worldwide. Arguably, this situation severely limits the ability of governments to tackle inequality.

Figure 2: Net private wealth and net public wealth to national income ratios, 1970–2015

Most worryingly, the effects of the above changes can be tracked directly into politics and are deeply inimical to liberal democracy, as described by Yascha Mounk, a lecturer on government at Harvard University: “Citizens have long been disillusioned with politics; now, they have grown restless, angry, even disdainful… Now, authoritarian populists are on the rise around the world, from America to Europe, and from Asia to Australia.”

Inequality is rapidly and unashamedly increasing, government policies are strongly influenced by lobbying on behalf of business and the wealthy, kleptocracy is becoming widespread, and robotics and artificial intelligence are increasingly likely to cut a huge swathe through earning potential among 90% of the population. Increasingly, electorates are seduced by extreme promises of change and scapegoating of immigrants and minorities. Meanwhile, the authoritarian impulses of so-called leaders are raised to new heights by the unlimited digital surveillance by both business and government. Drawing comparisons to the policies and politics of the 1930s, particularly in Europe, becomes ever more difficult to resist.

But, what of solutions?

Aye, there’s the rub. For in the simplest and most obvious solution—the redistribution of wealth and power—lies the most difficult personal and political decisions imaginable. Some of the wealthiest individuals, such as Chuck Feeney, mentioned earlier, and other modern-day philanthropists, such as Bill Gates, Warren Buffet, and Richard Branson, show what can be done. However, the impact of these personal efforts reflects the interests and beliefs of those involved. How it affects the underlying problem of inequality remains unclear.

Meanwhile, however, many individuals and business entities continue to hoard wealth beyond measure and amass power beyond control. Nick Hanauer, “one of those .01%ers, a proud and unapologetic capitalist”, an early investor in Amazon, and venture capitalist, wrote in The Pitchforks Are Coming… For Us Plutocrats in 2014: “But the problem isn’t that we have inequality. Some inequality is intrinsic to any high-functioning capitalist economy. The problem is that inequality is at historically high levels and getting worse every day… And so I have a message for my fellow filthy rich, for all of us who live in our gated bubble worlds: Wake up, people. It won’t last.” Few, it seems, have listened.

For the body politic, the redistribution of wealth and power comes no easier. Power—hopefully for the good of society—is the goal of every politician. And wealth is often the fastest route to it. With wealth increasingly concentrated in the hands of an ever-smaller minority, resisting the blandishments of the rich becomes daily more difficult. Redistribution of wealth, impossible or even dangerous.

Progress will require a coming together of all strands of society in support of a common cause and approach. Henry Mintzberg proposes three strands—public, private and plural—in his 2015 book, Rebalancing Society: “There are three key sectors in society, not two. The other one is known by a variety of inadequate labels, including ‘not-for- profit’ and ‘civil society’. Calling it plural can help it take its place alongside the ones called public and private, while indicating that it is made up of a wide variety of human associations.”

What would progress look like? My bet is on some form of universal basic income—as eloquently described by Scott Santens (for an excellent introduction, see Why we should all have a basic income)—and supported by all three sectors of society. The aim is not that everyone should be equally wealthy; rather that inequality should be dramatically reduced. The vision is that everyone has a right to live beyond abject poverty in a world sufficiently wealthy to support them.

Figure 3: Universal Basic Income (source: Why we should all have a basic income, Scott Santens)

We have already created the wealth needed, in large part over the past half century. Used wisely, there is no doubt that current and coming technology can sustain it. The real question is this: Do we have the will and generosity to distribute it equitably and use it for the good of all, to offer everyone equal opportunity, and—in the process—to save our one and only planet?