Income inequality is increasing worldwide and within specific nations, and that’s producing political turmoil, too, a recent United Nations report says. “Rising inequality creates discontent, political dysfunction and can lead to violent conflict,” the report warns, in a statement buried deep in its 218 pages.
But the same forces that produce the widening gap between the rich and the rest of us can be harnessed, by governments and by international cooperation, to start to close the chasm, UN Secretary-General António Guterres adds. But only if they want to, he notes. So far, they don’t, he warns.
The World Social Report 2020: Inequality In A Rapidly Changing World, by the UN’s Department of Economic and Social Affairs, paints a gloomy picture of the widening income gap. It warns of the negative political impact, too. The report is available on the UN website. “Without appropriate policies and institutions in place, inequalities concentrate political influence among those who are already better off, which tends to preserve or even widen opportunity gaps,” the report says. “Growing political influence among the more fortunate erodes trust in the ability of governments to address the needs of the majority.”
“This lack of trust, in turn, can destabilize political systems and hinder the functioning of democracy. Today, popular discontent is high even in countries that have fully recovered from the 2008 financial and economic crisis and have benefited from steady growth in recent years.” And the rich seize political processes to their advantage, worldwide, the report adds – just like in the U.S. That leads to mistrust of institutions and growing unrest.
“In principle, rising inequality should become a rallying cry for greater redistribution through progressive taxation and more comprehensive public service provision. However, this is often not the case. People in positions of power tend to capture political processes, particularly in contexts of high and growing inequality.”
“Without strict checks and balances to prevent it, big corporations and the wealthy may use their position and resources to lobby in support of their interests, raise legal challenges to progressive tax legislation, or promote communications and media campaigns to influence, for example, public perceptions of redistribution.”
“A strong middle class can act as a counterbalance to the interests of wealthier groups by demanding better and more accessible public services, infrastructure and social protection. Where the middle class is small or shrinking, it exerts insufficient political pressure.”
The report says 71% of the world’s people live in nations where income inequality is increasing. That group includes the two nations with the largest economies, the U.S. and China, and the two with the largest populations, China and India.