Book Review from the October 2018 issue of the Socialist Standard
‘The Divide: a Brief Guide to Global Inequality and Its Solutions’. By Jason Hickel, (Windmill. £9.99)
This is not a brief guide, but it is a very useful and informative one (though it would have been even more so with an index). Hickel’s account deals with the extent and origins of inequality between rich and poor countries, how it is maintained and how it might be removed.
This divide has not always existed, as around 1500 there were no big differences in living standards between Europe and the rest of the world. But European exploration and colonisation led to massive transfer of wealth as well as large-scale deaths, with around 95 percent of the population of what became ‘Latin’ America killed between 1492 and 1650. A hundred million kilograms of silver was transferred from the Americas to Europe, mostly by means of ‘coercive extraction’. Slavery also involved a vast accumulation of wealth in Europe, and thus boosted industrialisation: ‘The emergence of capitalism required violence and mass impoverishment, both at home and abroad’.
In 1820 the income gap between the richest and poorest countries was 3 to 1; around 1850 it was 35 to 1. Furthermore, there was massive inequality within the richest countries: in 1910, the richest one percent in Europe owned 65 percent of the wealth. Many former colonies became nominally independent, but they were still subject to much interference (to put it mildly) from the most powerful countries, from the 1953 coup in Iran to the mass killings in Indonesia in 1965, the coup in Ghana in 1966, the removal of Allende in Chile in 1973 and many more, all of which resulted in authoritarian governments friendly to Western interests.
Inequality in the West increased from the 1980s, and things came to a head in global terms with the Third World Debt Crisis of 1982, following which countries such as Mexico were forced to repay their loans and euphemistically-termed Structural Adjustment Programmes were introduced, which meant countries had to prioritise debt repayments and open their economies to international competition. The World Trade Organisation is one of several bodies that in effect tell poorer countries how to run their economies. These countries receive much in ‘aid’ from the wealthier ones, but these payments are dwarfed by the transfer of wealth in the other direction, via debt repayments, profit repatriation, capital flight, etc. The result of all this is a world where 4.3 billion people live in dreadful poverty, and the eight richest people have as much wealth as the poorest half of the global population combined.
The account summarised above is an excellent overview of the history of global inequality, but Hickel’s proposed solutions do not really address the causes. He advocates abolishing the debt burden of developing countries, democratising institutions such as the World Bank, making the international trade system fairer, introducing a global minimum wage and having a universal basic income. All this fits in with his odd and unsupported statement that the problem is not so much capitalism as a particular kind of capitalism (presumably its neoliberal version).
More interesting is his final chapter, which tackles environmental issues and the question of whether everyone in the world can live at the standard of the average person in the richest countries. One aim should be to achieve zero carbon emissions by the middle of this century, another to reduce total production and consumption, which can be done and still increase happiness and health. A Genuine Progress Indicator could replace GDP as a measure of wellbeing, though he sees all this as happening within capitalism. We cannot take a stand now on how such considerations would fare in socialism, but Hickel certainly provides here some ideas to think about.