Is true equality a pipe dream? The realities of economic distribution

Suppose we were on the brink of forming a new society.  Life as we know it right now no longer exists; each of us own nothing and are, in effect, nothing. 

annette kendall mba massey university

We’re all gathered together outside the walls of our new society and before we can enter through the gates we need to decide on the rules.  How are we going to live?  What entitlements will we have?  How will the products of our labour be distributed amongst everyone?  How will we ensure everyone gets what they deserve?

Before you start deciding on the rules however, there is one important point you need to be aware of: 10 percent of the people in this new society will be incredibly wealthy and enjoy a life of privilege, while the other 90 percent will be mere labourers, working long hours to support the lifestyles of the rich – ‘working for the man’ if you like.

None of us know whether we are going to be rich or poor and we need to decide how this society is going to work, not just for us, but for our children and the future of our children’s children.  What rules would you choose now?

A guy called John Rawls (A Theory of Justice) came up with the above thought experiment and in doing so he theorised that because everyone is in effect ‘gambling’ on which class they will end up in. They will all agree on rules that result on everyone having equal rights and equal opportunities.  If it turns out that they end up being poor then they want to have rules in place that will ‘maximise the minimum’ they will receive.

The whole theory is pretty hardcore and if you think about it with any seriousness your brain could well end up behaving like a fox terrier dog chasing its own tail.

What’s interesting though is that if you are concentrating more on the 90 percent chance of being poor you will no doubt be thinking that it’s just not fair that 10 percent of the population will pretty much rule the world.  But hold on a minute – isn’t that the society we live in now?

John Pilger (The New Rulers of the World) says that just 200 global corporations dominate 25 percent of the worlds’ economic activity. General Motors is bigger than Denmark, Ford is bigger than South Africa and countries with a population of 200 million people are sharing the same wealth as Goldman Sachs’ 161 shareholders. 

People are crying from every rooftop that the gap between rich and poor is getting so wide there is no chance of comeback.  Indonesia, a country once rich in natural resources, pretty much sold its soul to the global corporations a few years back and now it owes an estimated $262 billion, a debt that can never be repaid.  (Important note however, the Indonesian people didn’t sell their country, it was the country’s leaders who pimped out the country’s gold, precious stones and other riches and drove into the sunset in their blinged out cars.)

Before you buy into the whole ‘it’s not fair’ wail, stop to imagine a society where everything is equal.  We all receive the same entitlements, no matter how hard we work (or not).  That doesn’t seem very fair either – if we’re all getting the same benefits no matter what effort we put in then I for one, am going to take the easy road and sit on my lazy butt pretty much most of the time.  Why bother when you’re not going to get anything extra for your efforts?

What I’ve described here are two extremes but the fact is they are real.  Capitalism at its extreme is totally unjust but then socialist countries are not, in general, a picture of success either.

As with everything, it’s all about balance.  Be careful about jumping on the ‘capitalism is evil’ bandwagon unless you’re prepared to do some homework.  All too often we hear something on the news and believe it to be true because it was on the news.  Do we even stop and think before we make our minds up anymore?

CEOs will always earn the big bucks because there just aren’t many people with the skills (or the willingness) to do those jobs.  On the flipside, you’re never going to get mega-rich working in retail when there are plenty of people wanting to do that kind of work.

There is hope for our society.  People just won’t wear the whole global corporation fat cat thing anymore.  Say what you want about Generation Y but they definitely rate social responsibility within a company when they’re choosing who they want to work for.

One of the keys to a successful society, in my opinion, is opportunity.  When each of us have the same opportunities we are free to do as much (or as little) as we like in the pursuit of riches (and I’m not just talking monetary riches here). 

We can sit at our dining room tables, fagging away, moaning about our neighbour who gets the big bucks – or we can learn new skills and sweat blood and tears to get ourselves out of the ditch we may find ourselves in.  The choice is ours and in New Zealand at least, it’s always there, no matter if you’re one of the 10 percent or the 90 percent.

Annette Kendall  lives on a sheep and beef farm in the Tararua District and is currently undertaking research into the development of innovation, entrepreneurship and collaboration within rural communities

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