So much wealth in so few hands

Statistics on world distribution of wealth make for interesting reading. Two percent of adults in the world own more than half of global household wealth. Ten percent of adults account for 85% of the world total and the bottom half of the world adult population owns barely 1% of global wealth. This study, by the United Nations University, was launched in December 2006.

Just as a quick reminder, wealth is not judged on income. Wealth is represented by assets less liabilities. So if your credit-card debt is huge and your bond is close to maximum of the value of your property, you might not have much wealth — scary thought. In fact, the authors of the report noted that “many people in high-income countries have negative net worth and are among the poorest people in the world in terms of household wealth”.

So what makes me think of this? The answer is reading about the strikes happening in Germany, France, the United States, United Kingdom and South Africa, just to mention a few. A quick rundown of that: currently the train drivers’ strike is crippling Germany; the French transport and power workers are in their second day of strikes; and the UK survived a recent postal-worker strike.

The US has had extensive car-manufacturing workers’ strikes and the entertainment industry is suffering from a strike by writers. The lights on Broadway in New York are out as theatre workers strike. And many will remember the civil servants’ strike in South Africa. Eyes glazing over yet? Won’t bore you with more.

So cast your mind back to history lessons. I’m no historian, so pardon the sketchy references. Let’s look at the French Revolution. And Wikipedia, love Wikipedia, has a great little intro that states that France had an absolute monarchy with feudal privileges to the aristocracy and Catholic clergy. This system of government, if one can call it that, was overthrown by the revolution.

What about the February Revolution in Russia? That one put an end to Tsar Nicholas II, contributed to the collapse of Imperial Russia and the end of the Romanov dynasty. Russia had a few of these, but the end result was the same. It resulted in the sometimes nasty and terminal demise of the ruling people, and the uprising of the proletariat. The workers, mate!

There are parallels as well in society. In past centuries, ordinary folk worshipped royalty. It was an honour to work for a Lady or other titled being. One accepted the wages, which were a pittance. And nobody complained when he or she was thrown out because her Ladyship had a headache on that day. One didn’t even complain that without her reference no further jobs were possible.

Anybody notice the celebrity worship happening in recent years? These are the times when somebody as vacuous as Paris Hilton gets to be interviewed by Larry King because she was in jail for a few days for driving under the influence of alcohol. Or famous model Naomi Campbell is ordered to do community service because she physically abused her maid, the maid being one of several abused past employees.

Of course all of the above is fairly skimpy, to say the least. However, blog posts are not meant to be academic dissertations or lengthy research papers. There are many more qualified people who produce those. What I am hoping to do is to put a thought out into the universe and see what response will present itself. And that thought is: Is the developed world heading for a revolution?

Are we seeing a swing? Have ordinary folks finally had enough of the inequalities in the work environment where the CEO can get millions a year and the shelf stacker ekes out a living at less than £1 000 per month? There would be no supermarket business without stackers. Nothing more frustrating than empty shelves with one wilted lettuce leaf to prove that there were vegetables there!

One final interesting point. The attitude of the employer representatives, whether the South African government, the German Bundesbahn or the Hollywood studios, has been one of steely resolve to resist bowing to worker demands. Anybody remember that famous saying and the meaning behind it of who cares about poverty and starvation: if they can’t afford to buy bread, then “let them eat cake”?

What would the modern revolution look like? Is there a common enemy that the people could attack? Sure, striking workers are attacking their employers. But is there a single entity that one could attack? The royal family in the UK? Hardly. The governments of the developed world? Rounding up the very wealthy people, such as those on the Forbes billionaires list, and putting them in front of a firing squad? Also not really probable. Who or what is the enemy then?

So here is my suggestion, and I can already see the truck with the guys in white coats driving up to the front door to take me away. The developed world’s common enemy is the banking industry and the way the money is made available. But surely nobody is forcing people to get into huge debt? No, but in many cases they are not told the whole truth.

As an excellent example, consider the case of the subprime mortgages. Many people in the US got caught with false promises on their home loans. Sweeteners such as no payments for the first few months, much lower interest rates the next few months, and then finally after 12 months or so the real repayments had been glossed over.

A revolution that would involve a run on the bank? Well, Northern Rock can tell a few recent stories about that. To get an interesting perspective of the financial systems, view this fascinating series of videos on the financial institutions. And yeah, it’s YouTube. However, still worth checking.

The French proletariat, going back to that example, owned nothing. They “rented” everything from the royals or the church. Either way, they were beholden to somebody for every bit of their life. The majority of the ordinary people living in the developed world own nothing and they are beholden to the banks for every bit of their life. Makes you think, doesn’t it?