Trickle Down, Torrent Up

Source: polyp.org.uk

Half the world’s people own $1.76 trillion.  That’s a lot of money – $176 followed by ten zeros.  It is hard to imagine that amount of money isn’t it?  But 62 people in the world can, because these 62 people own the same amount: $1.76 trillion.

Yes, according to a recent Oxfam report,¹ just 62 people own as much wealth as half the world’s population.

Let’s try to put that into perspective and see if we can imagine the numbers involved.  On average each of those 62 people has a wealth of about the same as 58 million people.  Imagine that: one person having as much wealth as the populations of Australia and Canada combined!

Or, put another way.  Those 62 people could travel together on two buses with room to spare.  To meet the travel requirements of the 3.6 billion people making up half the world’s population would require a fleet of 90 million buses!

Furthermore, and more alarming is the statistic that the world’s richest 1% have an accumulated wealth greater than that of the other 99%.  Although this statistic is quoted by Oxfam, the statistic itself comes from none other than Credit-Suisse, one of the world’s top ten investment banks.

But it’s okay some say because the rich are undertaking benevolent and worthy philanthropic projects.  Yes, that is true; we have recently witnessed the rise in philanthropic giving on behalf of the rich.  The number of philanthropic foundations has increased, as has the amount being given by them.

That is good, isn’t it?  Not really, according to Linsey McGoey at the University of Essex who points out that:

“Philanthropy may be growing, but only in the context of rampant inequality.”

McGoey is quoted in another recent report, this one published by the Global Policy Forum.²  This report questions the role of large-scale philanthropic organisations and the rich individuals who run them.  The authors claim that these wealthy philanthropists:

• maintain undue influence over the agendas of global institutions,
• apply quick-fix, technological solutions instead of looking at longer term and structural issues,
• weaken democracies,
• are unreliable for ongoing financing, and
• lack monitoring and accountability mechanisms.

The report analyses the activities of two of the world’s biggest philanthropic foundations: the Bill and Melinda Gates Foundation, and the Rockefeller Foundation.  It focuses on two sectors: health and agriculture.  In both cases, and in each sector, it finds these philanthropies wanting.

Unhealthy Philanthropy

In the health sector the authors found that the involvement of these foundations undermined a more holistic approach to health and stifled scientific creativity.  There was an unhealthy revolving door between the Gates Foundation and pharmaceutical companies, noting that many of the Foundation’s staff had held positions at some of the world’s biggest pharmaceutical companies, e.g. Merck, Novartis, Bayer, Pfizer and others.

The report sums up it’s analysis of the role of wealthy philanthropists in the health sector by saying that:

“…too often the underlying more complex socio-economic causes of health problems and the need to strengthen public health systems have remained neglected.”

Damaging Farming

In agriculture too, wealthy philanthropists have been distorting and damaging infrastructure and local systems.  The main problem, according to the authors of this report, is that the philanthropists believe that the problem of hunger is caused by lack of technology, knowledge, and access to markets.  The money and influence of the philanthropists is directed in this top-down way with little or no support being given to local, small-scale farming.

The authors note that the structural issues underlying the problems of hunger are not recognised and certainly not addressed by the wealthy philanthropists.  These criticisms are endorsed by La Via Campesina, the global peasants, small farmers, fisherfolk, and indigenous peoples organisation.  In 2010 La Via Campesina criticised the Bill and Melinda Gates Foundation for purchasing 500,000 shares in Monsanto.  Dena Hoff, the North American coordinator of La Via Campesina said at the time:

“The Bill & Melinda Gates Foundation Trust’s purchase of Monsanto shares indicates that the Gates Foundation’s interest in promoting the company’s seed is less about philanthropy than about profit-making. The Foundation is helping to open new markets for Monsanto, which is already the largest seed company in the world.”

Not just the largest seed company in the world but also one of the world’s must unethical companies, according to Covalence, the Swiss-based organisation monitoring the world’s companies on Environmental, Social, Governance (ESG), Corporate Social Responsibility, ethics and sustainability, using online media monitoring, natural language processing and human analysis.  In fact, Covalence ranked Monsanto the most unethical company in it’s 2015 survey, claiming it to be:

 “… leads the world in the production of genetically-engineered seed, (and) has been subject to myriad criticisms.  Among them: the company is accused of frequently and unfairly suing small farmers for patent infringement.”

No wonder La Via Campesina are critical of the Bill and Melinda Gates Foundation.

The trickle down theory of economics hasn’t ever worked, and it still isn’t.  In recent decades the trickle has dried up, and it has become an upward flowing torrent.  Claims of tempering this inequality with philanthropic “generosity” are extremely dubious.  We must beware of such beneficent sounding programmes.  They can often be doing more harm than good.

1. Oxfam Briefing Paper, An Economy for the 1%, January 2016

2. Global Policy Forum is an independent policy watchdog that monitors the work of the United Nations and scrutinises global policymaking. We promote accountability and citizen participation in decisions on peace and security, social justice and international law.