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Raffique Shah


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The super rich vs the wretched

September 26, 2004
By Raffique Shah

FOR many people, more so those who believe that unfettered-capitalism is the way forward for the world, the latest listing of billionaires (millionaires excluded, and we speak here in US dollars) by the authoritative Forbes business magazine will serve as proof of their creed. It states: "After two years of falling fortunes, the collective net worth of the world's wealthiest jumped half a trillion dollars in the past year, to $1.9 trillion." Bill Gates still heads the list: at age 48, the computer genius is worth $46.6 billion. His business partner Paul Allen stands third ($20 billion), with "old money" Warren Buffet filling the second spot at $41 billion.

In fact, there are names in that list that would warm the hearts of those who swear that only in capitalism can you have rags-to-riches stories. The finest example, from that perspective, is Joanne Kathleen Rowling, a mother who once lived on welfare, but whose Harry Potter children's books have propelled her into Billionaires' Row. So too Sergey Brin and Larry Page, barely 30 years old, creators of the popular Google search engine.

And there's Hong Kong's Michael Ying, apparel manufacturer supreme, whose Gap-line of designer clothes has also propelled him into the upper echelon of the world's wealthiest. In an interesting twist to Forbes' latest listing, much looked forward to by those who like to "macco de rich", rising oil prices are said to be behind that country "minting" eight new billionaires. In fact, Russia now has 25 billionaires, trailing only the USA and Germany in members of this ultra-exclusive club. And it's here, in my view, that we can start to analyse why this growth among the world's wealthiest is leading us, ineluctably, towards a global social upheaval.

Russia is one of the poorest countries in the world. Or let me re-phrase that: it's a country with a large number of poor people, tens of millions of whom are literally starving. To compound the woes of the poor in Russia, that country's climate is brutal, more so to those who work to produce the oil-wealth that spawns its millionaires and billionaires. It's true that their lot was probably worse under communism and the existence of the Soviet Union. But it's also true that the mass of the people have not benefited one rouble from the fall of the Berlin Wall. In fact, only the innovative, the unscrupulous and the mafia have seen a better life after that vast country was supposed to have been delivered from the evils of communism.

But if Russia's 25 new billionaires and its multiple millionaires are beneficiaries of freedom-gone-crazy, what can be said of the rise in the fortunes of America's super-rich? One can hardly point accusing fingers at Bill Gates, whose rise to the top came through a combination of computer-wizardry and superior entrepreneurial skills. Bear in mind, though, that he has been accused by others in the lucrative computer business of unfair practices, like his monopoly on certain programmes and components that the competition must use. In fact, he has paid out money to settle many of these claims, thus avoiding court appearances.

If, however, we take the Waltons, five of whom own the mega-chain-retailer Wal-Mart, and are together worth US$100 billion, the true story of why the rich-poor gap is widening can be easily understood. That they (Alice, Helen, Jim, John and S Robson) are the focus of some attention in this year's presidential campaign, suggests all is not kosher with this giant-of-a-company. John Kerry has hammered Wal-Mart for paying "abysmally low wages" to its tens of thousands of employees. Dick Cheney has praised its "spirit of enterprise, fair dealing and integrity". What is the truth about this family built business that, by the year 2000, had overtaken General Motors in worth, and is richer than Switzerland?

Wal-Mart opens an average of two new stores every week somewhere in the world, and it buys up around US$1 billion in real estate at the same pace. Yet, in America, where the Waltons started out in the 1950s, and where it employs over 600,000 persons, the latter cannot afford to buy many products they sell because they are paid dog-low wages. More than half its staff cannot afford to be part of the company's health insurance plan. The bulk of them are paid minimum wages, there is nothing like "overtime", and the mighty Waltons are known for encouraging their employees to apply for food stamps and welfare. Most take a second job anyway, since they can barely afford to survive on their wages.

Skip halfway across the world to Dubai, where Sheikh Mohammed bin Rashid sits atop sand dunes that are being turned into billion-dollar luxury hotels, US$5 billion is being spent on a Disneyesque project that will include indoor snow skiing. Among them, the Sheikh and his three brothers are estimated to be worth US$10 billion. The sources of the ruling family's wealth are fuzzy, but 85 per cent of the people who live and work there are mainly the poor from India, Pakistan, Iran, Egypt and similar nearby countries. Their wages are, like Wal-Mart employees, dog-low, and the conditions under which they labour are atrocious. The rule of law is the rule of the, well, ruling family.

In this unimaginable world of the super-rich, there is no thought about trying to close the rich-poor gap, of bringing about some form of social equity. In the USA, the gap continues to widen and the poor to suffer. In the UK, Rowling can now avoid having to look at those who eke out an existence in that country. The egalitarian goals of some of Europe's progressive states have given way to "only-the-strong-will-survive" policies. And in Third World countries, in places like Haiti, we are talking about not persistent poverty, but permanent misery.

Any wonder that social scientists are predicting a global uprising by the dispossessed long before global warming takes its toll on humanity? And lest we think we are insulated, ours is not too different a society. Nebulous talk about social equity remains talk for those who seem to have been born to "ketch-arse" until they die. What the Forbes magazine list brings home to us in a way its editors never intended is that the opulence of the few at the expense of the abject poverty of the many can lead us in only one direction. Before we know it, the wretched of the earth, like the biblical Barbarians, will be battering the fortified walls of the super-rich, and even the not-so-rich, to wreak the kind of destruction that could take us back into the Dark Age long before we see signs of the Ice Age.