Capital and inequality

Wols (Alfred Otto Wolfgang Schulze), untitled (time_money), 1988.


The increase in socioeconomic inequalities in recent decades represents one of the most worrying structural trends of the beginning of the XNUMXst century

The legitimization of inequalities in any society is a constant challenge that gives rise to a myriad of divergent discourses and ideologies. As noted by Thomas Piketty in Capital and ideology, this is an intellectual, institutional and political process that shapes social and political structures

In the current scenario, the proprietarian, entrepreneurial and meritocratic narrative prevails as a justification for the hyper-capitalist inegalitarian regime, believing that modern inequality is the result of individual choices, equal opportunities and personal merit. However, this narrative, which gained prominence in the XNUMXth century and underwent a global reformulation at the end of the XNUMXth century, is showing signs of fragility.

In recent decades, a global phenomenon has been challenging the narratives that sustain socioeconomic inequalities. Since the 1980s and 1990s, inequalities have increased in almost all regions of the world, reaching levels that make it difficult to justify them in the name of the general interest. Meritocratic and entrepreneurial rhetoric, which argues that modern inequality is the result of individual choices and equal opportunity, is increasingly at odds with the reality faced by disadvantaged classes, who often have limited access to education and wealth.

Furthermore, the blaming of the less privileged is becoming more prominent, which contrasts with past inegalitarian regimes that emphasized functional complementarity between social groups. This modern inequality is also associated with discriminatory practices and statutory and ethno-religious inequalities, which are rarely mentioned in meritocratic narratives. Given these contradictions and the absence of a new universalist and egalitarian vision to face the challenges of the XNUMXst century, the risk of a resurgence of xenophobic and nationalist populism becomes a worrying possibility.

The essence of any inegalitarian regime lies in the complex interconnection between a theory of the border and a theory of property. These two crucial issues play interdependent roles in shaping societies and justifying inequalities. The border question requires an explanation of who belongs to the political community, in what territory and under what institutions this community should organize itself, and how it relates to other communities in the global context.

The issue of property involves the definition of relationships between owners and non-owners, ranging from the ownership of individuals, land and companies to natural resources, knowledge and financial assets. These property regimes, along with educational and tax systems, play a central role in structuring social inequalities and their evolution throughout history.

In ancient societies, such as slave societies, the issues of the political regime and the property regime were closely intertwined, since some individuals owned others and exercised both power over people and over the land. In ternary societies, which were divided into three functional classes, the dominant classes held sovereign powers and properties, maintaining this direct relationship between power over individuals and properties.

In the proprietary societies that flourished in Europe in the XNUMXth century, there was an attempt to strictly separate property rights from sovereign power, but the relationship between political regime and property regime remained intricate. Census regimes long reserved political rights for property owners, while constitutional rules limited the ability to redefine the property regime peacefully and legally.

These structural connections between political regime and property regime persist in modern societies, including postcolonial and hypercapitalist societies. It is essential to recognize that contemporary inequality is deeply influenced by the system of borders, nationalities and social and political rights, which generates complex ideological conflicts in the XNUMXst century. Ethno-religious and national cleavages often make it difficult to form comprehensive political coalitions to address rising inequalities.

The increase in socioeconomic inequalities in recent decades represents one of the most worrying structural trends of the beginning of the XNUMXst century at a global level. This phenomenon challenges not only economic stability, but also the search for solutions to a series of other pressing challenges, including climate and migration issues. Reducing inequalities and establishing an acceptable standard of justice has become fundamental to effectively address these challenges.

A simple analysis, based on the top decile's share of total income, reveals a notable increase in inequalities since the 1980s in almost all regions of the world. This share, which was around 25%-35% in 1980, now ranges between 35%-55% in 2018, suggesting that inequalities may continue to grow. Furthermore, the increase in inequalities has disproportionately affected the poorest 50%, whose share of total income has decreased substantially. Inequality disparities vary significantly between regions, even considering similar levels of development.

For example, the United States has seen a faster rise in inequality than Europe, and India has experienced a steeper rise than China. Furthermore, some regions, such as sub-Saharan Africa, Brazil and the Middle East, were already highly unequal in 2018, with the top decile holding an even larger share of total income.

The complex origins of these inequalities range from historical legacies to racial and colonial discrimination, with factors such as the concentration of oil wealth playing a role. However, these regions have in common the fact that they are located on the frontier of contemporary inequalities, with the participation of the top tenth at around 55%-65% of total income.

In conclusion, the reflections presented from the work Capital and ideology, by Thomas Piketty, highlight the complexity of issues related to socioeconomic inequalities and their global impact. Legitimizing inequalities has been an ongoing challenge in societies, with narratives based on meritocracy and entrepreneurship on the rise, justifying wealth disparities.

Ultimately, it highlights the need for deep reflection and coordinated action at global levels to address growing inequalities and build a fairer and more equal society in the XNUMXst century. The resurgence of xenophobic and nationalist populism is a risk that must be avoided, and the promotion of alternative narratives and effective solutions becomes essential to forge a more equitable future.

*Pedro Henrique M. Aniceto is studying economics at the Federal University of Juiz de Fora (UFJF).

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