What’s Right With The ‘Reducing Extreme Wealth’ Approach

As the 2030 agenda for sustainable development has been adopted, more and more development actors, global leaders and celebrities are getting enthusiastic about starting a new chapter in development....

As the 2030 agenda for sustainable development has been adopted, more and more development actors, global leaders and celebrities are getting enthusiastic about starting a new chapter in development. But is this really going to be a new chapter?

In view of the UN sustainable development summit last September, anthropologist Jason Hickel wrote an article supporting the idea of “de-developing rich countries” and in a recent piece on the Guardian Zoe Williams has brought attention to a thought-provoking cartoon released with The Knife’s album ‘Shaking the Habitual’ in 2013. The graphic novella realised by the Swedish artist Liv Strömquist, claims that reducing extreme wealth should be the real focus of development.

While “reducing extreme wealth” might seem a radical and probably unrealistic aim, overturning the current poverty reduction paradigm exposes some the main problems with international development. More than representing a conventional development goal, the “reducing extreme wealth” approach hits the core of the universalised development discourse and sheds light on the darker corners of the newly adopted Sustainable Development Goals.

“Reducing extreme wealth” does not mean to assume that poverty is the norm or to ignore the suffering of people living in extreme poverty. Quite the contrary, it means to look less blindly at the relations and dynamics that have produced poverty and to rethink the growth model that has dominated mainstream development discourse for the last 25 years. The ironic tone of “reducing extreme wealth” provides a lucid picture of where we are and in whose interests and according to whose moral, economic, social, legal and political values the development goals have been elaborated.

There are two main contradictions that this idea exposes. The first is how consumption and not poverty reduction is the real fulcrum of the development agenda. Innovative business models are becoming the solution to reduce poverty, increase gender equality, protect the environment and facilitate access to basic resources and services. These forms of bottom billion or bottom of the pyramid capitalism have increasingly adopted the label of social or ethical business only for operating in low-income markets and promoting market-based solutions to the needs of the poor.

Philantrocapitalism, often in partnership with global corporations, has come to dominate modes of development financing and to influence the development agenda.

New development practices, flavoured with a generous dose of entrepreneurial spirit, have also shaped the concept of sustainability, flag of the new development goals. For many development actors this is not necessarily bad, but I think that more debate on how to make philanthrocapitalists and their corporations truly accountable is needed.

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The second aspect is that the “reducing extreme wealth” approach finally invalidates the dependency paradigm and the values that have legitimised this paradigm. A main problem in the sustainable development model is that sustainability is not understood as a serious debt of the rich towards the poor and poverty reduction is often considered as an act of solidarity and generosity according to Western morality and ethics.

New partnerships and alliances emerging so prominently in the SDGs do not seem to really change the dependency paradigm, but to maintain the status quo by compensating for the loss of power of the international financial institutions (particularly following the financial crisis). Who has the money makes the rules and some philanthrocapitalists surely belong to “the 1% who is likely to control half of the global wealth by 2016”.

To be a bit more precise about goals and policies, there are three points emerging from The Knife’s cartoon that can be useful to think more concretely about what a “reducing extreme wealth” approach would imply.

The first is the politics of the “micro-” which has become so popular in development thinking, particularly through microcredit, microfinance and microentrepreneurship. To reduce extreme wealth means to reframe the idea of “you can do so much with small means” and give responsibility to the rich to get out of extreme wealth, instead of giving responsibility to the poor to lift themselves out of poverty, as the current development model implies.

This really shows how the idea of grassroots participation is not a peculiarity of poorer countries, and that perhaps are not the poor those who need to be included and democratised. A question widely discussed among development practitioners and theorists is to understand when a micro- approach can be considered truly transformative.

One of the researchers in the illustration considers “treeplanting” as the most successful way to fight extreme wealth and to avoid financial institutions to spread uncontrolled. Interestingly planting trees was the distinctive activity of the Green Belt Movement founded by Kenyan activist and scholar Wangari Maathai. However, treeplanting has never attracted as much attention and funding as microcredit, despite Maathai and Yunus have both been awarded the Nobel Peace Prize.

This brings to the second point on gender equality. I’m not going into the gender roles and relations of the characters of The Knife’s cartoon, surely well-thought by the authors. But I want to focus on how the comic points out at the lack of women at the top of the income distribution “men are clearly over represented among the too wealthy”.

On the other side, women are over-represented in poverty and research has consistently shown how inclusion or gender equality policies are not necessarily the solution. Gender equality is often grounded in efficiency considerations and poverty reduction initiatives can put unsustainable weight on the shoulders of women: women are often directly or indirectly invested with the responsibility to lift themselves, their family and community out of poverty.

It should be said, however, that the ambiguity of gender equality policies is not just a problem of poorer countries: flexibility and austerity policies are well known for affecting women more than men despite Western countries constantly show off their balanced gender equality percentages. Beyond all the convergent or divergent but surely complex debates on the significance of equality, diversity, empowerment, gender rights, freedom and justice it is always important to make a distinction between formal and substantial achievements.

Also the current debate about having a female UN Secretary General needs to be considered not simply in its formal representative significance, but in its possibility to bring more and different voices in the global system. Gender equality should aim to something more than just “a small candle of hope”.

A third aspect is how researchers and in particular economists, although they tend to present themselves as external to the problem, have greatly contributed to shape development knowledge, privileging particular policies over others and legitimising some developmental practices. Economic knowledge has been gradually popularised and become part of everyday development practices.

An immediate example is the human development approach by Amartya Sen that has shaped the destiny of development thinking. In talking about knowledge, it is also interesting to notice that in The Knife’s cartoon education is given the arduous task of letting the rich know that “the natural resources are ending”. Education here is reinvested with a social and transformative role almost taking distance from the increasingly individualistic aim and responsibility of education in richer countries.

After these reflections there is a key question that everyone might be thinking, weather and how overturning the development paradigm and focusing on reducing extreme wealth would help people in extreme poverty and favour redistribution. I don’t have an answer to this question, but I think that challenging our understanding of poverty will help us to focus on the problems of development instead of keep glorifying its success.

This also poses a dilemma for development professionals and researchers: should we continue to make small changes within the existing development paradigm (at the condition of stop selling these changes as big, revolutionary alternatives) or should we fight to challenge the paradigm itself and reimagine a new one driven by different values?

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Development
Serena Natile

Serena is a feminist researcher, lawyer and lecturer, mainly interested in feminist political economy, gender politics, critical approaches to development, financial inclusion and mobile finance, and EU and international law. Serena holds a first class degree in Law from the University of Siena (with an academic year spent as an Erasmus exchange student at the University of Bristol Law School), a MA cum laude in Law and European and International Relations from the University of Trento and a PhD in Law from the University of Kent, where she is an Associate Lecturer and Researcher. Serena is also an activist for gender rights and serves as a legal advisor for labour unions and NGOs in Italy. Before starting her PhD, Serena worked for the Permanent Representation of Italy to the EU and for the UNDP in Brussels and collaborated with various women’s rights organisations in Kenya, Ghana and Uganda.
2 Comments on this post.
  • MunawarALI
    15 December 2015 at 4:05 pm
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    It would be good if incremental wealth creation is channeled to alleviate poverty by creating enabling capacity in those who are in need. Helping nurture collective entrepreneurship so that enabling capacity. A global institution with local subsidiaries will give it institutional cover.

  • The Rise of Global Inequality and Philanthrocapitalism
    28 January 2016 at 10:55 am
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    […] I have argued in a previous article, if we haven’t succeeded in focusing on the welfare of the poor, we would probably obtain more […]

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