Global**** Wealth Equality:
What Would it Mean?
December 3, 2014
(Note that some links to sources break over time, but when written they were all valid links.)
"Bill Gates says poverty is decreasing. He couldn't be more wrong" by Jason Hickel
How much wealth would people have if all of the wealth in the whole world were shared equally?
The total personal (as opposed to government-owned) wealth of the world in the year 2000 was approximately $300 trillion.* The number of people in the world (including children) in 2000 was approximately 6.3 billion. Do the division and one gets approximately $48,000** of wealth per every man, woman and child on the planet, i.e., the global average per capita wealth. A family of four would thus own a bit more than $190,000 of wealth. The average number of persons per "household" (as opposed to family) is about 2.6, so a family this size would have $124,800 of wealth.
To put this in context, in 2004*** approximately 65% of American households had a net worth less than $190,000, and approximately 55% had a net worth less than $124,800. On the low end many families had zero or less than zero (because they owed debts more than their assets were worth) net worth (one in four, according to this report). One survey shows that "more than half of Americans reportedly have less than $1,000 to their name" and "24.8% have less than $100 to their name." On the high end, of course, some families, like the Waltons who own Wal-Mart, owned billions of dollars' worth of wealth and the Rockefeller family fortune is conservatively estimated to be at least $1.3 Trillion.
It is well known that the United States is a "rich nation" and most of the world is economically much poorer. It is interesting, therefore, to know that if all the wealth of the world were somehow magically redistributed among all people on the planet equally, to make the billions of poor people in places like India, Ethiopia, Haiti and Bangladesh equal in wealth to Americans and everybody else, then 55% of American households would be richer, not poorer. (This underscores how nationality is not a very useful category when thinking about making the world more equal.) Thirty-five percent of American families would be poorer, among whom are the 10% of American families whose net worth exceeded $830,000 in 2004.
Global Equality Is About Sharing, Not Leveling Down
The goal of global wealth equality is not, however, to redistribute wealth in the simplistic way that the above discussion would imply. The goal is not to "level down" by taking away from any family owning more than $190,000. On the contrary, the goal is to "level up" in a manner consistent with preserving a good environment for future generations. The goal is to create an economic and political system in the world in which all people have an equal status economically and politically. What does this mean?
Economically, it means that everybody would be welcome to participate in a sharing economy in exchange for contributing reasonably to that economy. In the sharing economy, goods and services that are sufficiently abundant are free to those who have a reasonable need or desire of them. And things that are scarce are rationed equitably according to need. Anybody who is willing to contribute, even if it means initially just learning a useful skill, can join the sharing economy; nobody is involuntarily unemployed.
Politically, it means everybody who supports the principles of equality and mutual aid would be able to attend their local community and workplace assembly and have an equal say with all others in making community and workplace decisions, i.e., laws that would apply to all people in that community or workplace. No higher bodies would have law-making powers. Social and economic order and coordination on a larger-than-local level would be achieved by voluntary federation: local assemblies would send delegates to "higher level" bodies whose purpose is to craft proposals (not laws) that the local assemblies are free to accept and carry out, or reject until the proposal, after back and forth negotiation, is amended to be satisfactory.
Local assemblies would each decide whether or not to be in a sharing economy with other local assemblies. They would each on their own decide how to contribute to the sharing economy and, in turn, the other local assemblies would each, on their own, decide with what other local assemblies they wished to share, i.e., be in a common sharing economy. In practice, large geographical regions and widespread economic enterprises, each consisting of many local assemblies in voluntary federation, would acquire reputations on the basis of which other large geographical regions and enterprises would decide whether or not to be in the same sharing economy with them.
These reputations, along with other information, would make it possible for people to decide who they felt was making a reasonable contribution to the sharing economy and who wasn't. Local community and workplace assemblies, in turn, would make decisions about what was expected of their own members (what was a "reasonable" contribution to the economy, and what it is reasonable for people to take from it) with the goal in mind of preserving their good reputation, and hence membership, in the larger sharing economy. Those people who do not contribute reasonably would be outside the sharing economy and would be, essentially, beggars whom others could give to or not as they pleased, from those goods and services that they could reasonably take, for themselves alone, from the sharing economy.
What About the Well-To-Do?
Here is where the principle of "leveling up" comes in. It's all about how people who value equality and mutual aid decide what a "reasonable" contribution to the sharing economy is. People who live in a region that has a highly developed infrastructure of roads, railways, factories and universities etc., or in a region with important but scarce natural resources, would probably be expected to contribute more things or provide greater services to a sharing economy than people from poorer regions, at least initially until the poorer regions developed their productive capacities more. In a sharing economy, unlike a capitalist one, everybody benefits when the productive capacity of somebody else improves. It makes it possible for everybody to choose between two pleasant possibilities: everybody works less but still enjoys the same amount of shared economic productivity, or everybody continues to work the same and enjoys greater shared economic productivity. Mutual aid rather than competition is the basis of people's relationships with each other in a sharing economy. People in poorer regions might enjoy less wealth initially than people in richer regions, but over time the result of mutual aid and sharing will lead to greater and greater equality in standard of living across formerly richer and poorer regions.
What does "leveling up" mean for a well-to-do American family with substantially more than $190,000 of personal wealth? Let's say the family owns a $1 million dollar home and owns $5 million worth of stocks. The $5 million in stock represent shares in businesses where people work. In the sharing economy businesses are activities that people do, they are not things that other people own. The $5 million of stock certificates would become just worthless pieces of paper (as would all forms of money itself). The adults in this family would lose their income from these stocks. But if they contributed to the sharing economy in a reasonable (as determined by their local assembly) way then they wouldn't need any "income" because they could take freely what they needed or desired from the stores where products and services were made available (or they could "get in line" so to speak for scarce things equitably rationed in a manner determined by the local assembly, which they could attend as an equal with all others.)
This family would continue to have the most important things that their former income provided: a good place to live and all of the things required for a comfortable and satisfying life, good education, health care, vacations, and security in old age (older retired people, children, disabled people etc. would be members of the sharing economy because their "reasonable" required contribution would be zero.) In many ways this family's lives would be much better than before: the world they lived in would be a friendlier place instead of one in which ruling elites used Orwellian wars of social control to make people fear other nationalities or ethnic groups; they would benefit from the fact that government wealth would be used for things like schools and libraries and hospitals that actually make our lives better instead of things that don't, such as military forces and weapons and "Homeland Security" and prisons; they would share in the far more useful economic productivity of almost four million Americans who presently produce little of real value in our prisons or the military and who would contribute far more if we had a global sharing economy; they would benefit from no longer having to endure mind-numbing and anxiety-producing "ask your doctor about" advertisements and planned obsolescence; those of them who were managers would no longer confront workers in the old labor-management conflict because everybody in the workplace assembly would have an equal say in all decisions and would have equal standards of living; they would no longer have anxiety about where they stood in the hierarchy of wealth and respect from poor to rich; and they would no longer live in a world in which they were resented and disliked by those at the very bottom of an unequal society, or those who were unemployed because the economy, unlike a sharing economy, only employs people if it will make a profit for an employer.
What about the family's $1 million dollar home? They would continue to own that home and live in it. If there were homeless people in the community the local assembly would probably rather house them temporarily in whatever available buildings were suitable and then arrange for the construction of nice homes for them, than resort to having them housed in spare rooms of already occupied large houses. The local assembly might think differently about the multiple mansions that are usually unoccupied and are owned by a family like the Waltons, but this would affect only a very tiny percentage of Americans.
No More Ugly Debates About Who Should Be Paid More than Whom
The global equality as outlined here will mean no more ugly debates about who should be paid more than whom. People won't work for a paycheck; they'll work to be equal members of the sharing economy. Whether they contribute as a teacher or a physician or a janitor, a factory blue-collar or white collar worker, a jet pilot or auto mechanic, an adult student or a person in charge of caring for children, and whether they live in the United States or Bangladesh, if they are in a common sharing economy then they all get "paid" the same: membership in the sharing economy.
How Do We Make it Happen?
The most important step towards making this kind of globally equal world a reality is to make this vision of a better world something that billions of people are talking about explicitly, and to make sure that these billions of people know that they are billions in number and not a small powerless minority. This is what it means to build a revolutionary movement--talking with people about what the goal of a revolution should be, what people really want. It also means helping people see that most people in the world already try to shape the little corner of the world over which they have any control by the values that this vision is based upon, the values without which it could never work--equality, mutual aid, concern for one another, democracy. There is a minority of people, who presently rule the world, with the opposite values--inequality, domination, divide-and-rule. A revolutionary movement that is clear on its goals and confident in its numerical strength can remove the ruling elites from power and turn the world upside down, making it an egalitarian paradise instead of the increasingly unequal world we have today that is divided into lots of have-nots and a few haves who use violence and warmongering and lies to protect their enormous wealth, privilege and power. For further discussion of this see Thinking about Revolution and "How We CAN Remove the Rich from Power."
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* This number is "Purchasing Power Parity" adjusted, which means it takes into account the fact that some things are cheaper in one country than another. If all personal property in the world were sold and the money then used to buy commodities in the country where that personal property was located, those same commodities would cost $300 trillion if purchased in the United States.
** This is perhaps too low a figure. Credit-Suisse reports here (for 2012-13), "As already noted, global household wealth equates to USD 51,600 per adult, a new all-time high for average net worth. This average global value masks considerable variation across countries and regions, as is evident in Figure 3." Using this figure of $51,600 instead of $48,000 would mean that perfect global wealth equality would benefit even more Americans than what is asserted based on the lower figure.
*** Different sources are based on different years, making it difficult to base everything on the same year.
**** Here are the results for no rich and no poor in just the United States:
If wealth and income were equal for all in the United States, then (based on per capita [every man, woman and child] wealth and income) every household with the average household size of 2.58 people would have $1.04 million as its share of the total wealth of the United States; it would own $743,000 of household and non-profit net wealth; and it would have an annual income of $130,000 . A household consisting of four individuals (such as two parents and two children) would thus have an income of $201,550 and own $1,152,000 in household and non-profit net wealth. [The arithmetic and sources are given below.]
Presently, half of U.S. households have an income less than or equal (mostly less than!) to $59,039 , and a little more than 80% have an income less that the $130,000 it would be if there were no rich and no poor; and 14% of U.S. households today have a _negative_ net worth (debts are greater than assets). [ https://www.fool.com/retirement/2017/05/14/166-million-us-households-have-a-negative-net-wort.aspx and https://dqydj.com/united-states-household-income-brackets-percentiles/]
The Arithmetic and Sources
"The financial position of the United States includes assets of at least $269.6 trillion (1576% of GDP) and debts of $145.8 trillion (852% of GDP) to produce a net worth of at least $123.8 trillion (723% of GDP)[a] as of Q1 2014." [1]
The U.S. population in 2014 was 318.6 million [2]
$123.8 trillion divided by 316.6 million gives $405,000 wealth assets for every man, woman and child living in the United States. For a family of four, this means it would be $1.62 million.
U.S. Household and Non-Profit Net Worth (i.e., the figure less than the above $123.8 trillion because it excludes publicly owned wealth and wealth owned by private corporations) was $93 trillion in 2016. [3]
The U.S. population in 2016 was 323.4 million [4]
$93 trillion divided by 323.4 million gives $288,000 of household and non-profit wealth assets for every man, woman, and child living in the United States. For a family of four, this means it would be $1.15 million.
WHAT ABOUT INCOME (AS OPPOSED TO WEALTH)?
The total U.S. income in 2017 was $16.4 trillion. [5]
The U.S. population in 2017 was 325.7 million [6]
$16.4 trillion divided by 325.7 million gives $50,353 of income for every man, woman and child living in the United States. For a family of four, this means $201,400.
"The U.S. Census Bureau reported in September 2017 that real median household income was $59,039." [7]
"The 2010 Census enumerated 308.7 million people in the United States, a 9.7 percent increase from 281.4 million in Census 2000. Of the total population in 2010, 300.8 million lived in 116.7 million households for an average of 2.58 people per household." [8]
Based on the above, if wealth and income were equal for all in the United States, then every household with the average size of 2.58 people would have $1.04 million as its share of the total wealth of the United States; it would own $743,000 of household and non-profit net wealth; and it would have an annual income of $130,000.
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1. https://en.wikipedia.org/wiki/Financial_position_of_the_United_States
3. https://en.wikipedia.org/wiki/Wealth_in_the_United_States
5. https://www.statista.com/statistics/216756/us-personal-income/