Great Responsibility: The 1% Issue
The wealth gap announcement that hit the news recently due to the OXFAM report about the world’s wealthiest 1% is both old news, and at the same time, shocking.
American ethical and economic assumptions have inculcated in me a strong sense of surety that hard work pays off. I have always felt that earning a living for myself (from selling squash from my garden by the roadside, to running a thriving consulting firm) would facilitate my ability to have a lifestyle that worked (safety, shelter, healthcare, education for my children, comfort, small luxuries). And as a well educated, white, middle-aged, able-bodied, heterosexual woman living in 21st Century USA, I have benefited both from great privilege and from genuine effort.
But the very economic system that I have grown up believing in has gone horribly awry, and it is time that business takes a stronger role in fixing it.
The world’s richest 1% will have as much wealth as the remaining 99% of the world next year…said another way, the report states that the 80 richest people on the planet have the same wealth as the poorest 3.5 billion people.
80 people’s wealth = 3.5 billion people’s wealth
Experts speculate that politics and policies that favor big business and the wealthy have exponentially increased disparity between the über wealthy and the world’s poorest.
- Have we deluded ourselves as a society into thinking that somehow this is acceptable? That it is perfectly okay that our system creates more and more luxury and excess for a tiny few, while the vast majority live with less?
- Do we really believe that these inequalities are created by purely the hard work of the ultra rich, and by default, tell ourselves a story that the non-rich are simply not working hard enough?
In the companies and organizations we (at Moementum) work with, everyone is usually working hard, including those in the lower wage jobs, night shifts, and unskilled labor roles that keep people trapped in multi-generational poverty cycles.
I do not have room in this blog to dig into the complexities of tax law and policies that have created this situation, but rather to underline what Winne Byanyima (Executive Director of OXFAM) said: “It is time our leaders took on the powerful vested interests that stand in the way of a fairer and more prosperous world.”
I remember at school as a kid, some days I was short on lunch, and borrowed from my friends to fill up. And some days, my lunch box was full, and I shared with them. Metaphorically, it feels wrong that I eat a luscious protein rich meal while my classmate next to me gets by on stale Cheetos and fake juice.
There are dynamic, creative new business models arising every day such as the B Corp movement, sharing economic models (AirBNB), and contraction efforts (downsizing) that offer alternatives to more and better wealth hoarding in our communities. Businesses, whether a micro entity or a megalith that the government orders “Must Not Fail” have a role in evaluating how they do what they do to both reward excellence, and to share for the common good.
A few basic ideas for any business or business owner:
- Evaluate and understand your pay practices so that you can ensure equity across roles.
- Look at the distance between your lowest paid employee and your CEO and ask the question, is this ratio appropriate?
- Make courageous change when inequity is found—do the right thing.
- Remember that all jobs in a company make it click—pay your leaders commensurate to their roles, and pay your dirtiest jobs what they deserve.
- Look for ways to save waste inside your company so that there is more funding available for employee compensation, retirement, and benefits.
- Decide how much is enough for you and your shareholders to make (there is “enough”) and proactively manage the overage responsibly (reinvesting locally, sharing with employees, reducing prices, charitable gifts).
- Notice the gap between your wealthiest employees/shareholders and your poorest, and seek strategies with your leaders to reduce the gap.
- Keep your profit local.
- Pay the taxes you and your company owe—these provide necessary social, law enforcement, judicial, and other services that make our society work for all.
Truth is, my stomach turns at this report. I feel disgust. I am proud of my success and have nothing to feel ashamed of (and neither do you). But we can and must do better, and while ultimately the lawyers and policy makers set the policies that help to make the really rich get richer, I also believe that each of us plays a role.
Managing ridiculous wealth disparity starts with responsible and accountable business owners and shareholders who are making a profit today. Star Wars mythical character Yoda said, “With great power comes great responsibility.” It is our job to notice the wealth disparity, to call out its absurdity, and to actively and courageously make room for our fellow citizens of the world who also work hard, but don’t have equal privilege and access. For our world economy to work, we cannot just turn our heads away from the “other 3.5 Billion.”