Crawford n Leadership Forum.Global Realities, Domestic ChoicesJoseph StiglitzPhotography by Andrew Taylor on the 30th June 2014 at the n National University.The recent shift to the right-wing leaders in the United States and parts of Europe, has seen more politicians advocating protectionist policies that purport to help the poor, but in fact worsen their plight.
That is the view of renowned economist Joseph Stiglitz, a one-time adviser to former US President Bill Clinton, whom I interviewed this year.
He believes inequality is worsening mainly due to political forces.
Stiglitz was one of the most outspoken voices in the debate over how rich countries can best aid economic development in poor countries while at the World Bank between 1997 and 2000.
Some speculate Stiglitz – who was critical of the the International Monetary Fund’s policies in Russia and east Asia during financial crises – left the bank due to his frustration with the lack of action taken to stem inequality.
Now he’s free to be critical and has written about the political forces exacerbating inequality in a book entitled, Globalisation and Its Discontents Revisited: Anti-Globalisation in the Era of Trump.
He says US President Donald Trump’s policies will do nothing to improve the plight of low-income Americans who he purports to represent.
In fact, Stiglitz argues, Trump’s policies will worsen inequality.
“As a great actor, he has persuaded them he cares about them, even as he picks their pockets,” he told me.
Despite world leaders signing up to a global goal to reduce inequality, the gap between the rich and poor has widened.
Just eight men own the same wealth as the poorest half of the world, according to an Oxfam paper released in January.
Apart from political forces, others argue technological advancement is worsening inequality.
Last week I interviewed co-author of Freakonomics Steven Levitt.
He says it is not political forces but economic ones – the way the labour force is organised – that increase inequality.
“Many have argued that as the world moves towards automation and artificial intelligence that the role of unskilled labour will become more and more marginalised,” he told me.
“People smarter than me are worried about it, and that makes me worried too.”
Take for instance self-driving cars, which are already common on the streets of Silicon Valley and could in five to six years be on n roads.
Those who have most to gain? The people creating the product and/or making money out of it.
Technology giant Uber has this year been shopping for self-driving cars.
In March, it placed orders for 100,000 autonomous S-Class Mercedes Benz cars.
And last week it announced that it plans to buy up to 24,000 self-driving cars from Volvo.
But it is not just driving that’s a replaceable skill.
People undertaking other routine jobs, like cleaning and lodging tax returns, may be made redundant by robots.
Carl Benedikt Frey and Michael Osborne, co-directors of the Oxford Martin Programme on Technology and Employment at the Oxford Martin School, say the problem isn’t confined to workers in advanced economies.
In their book, The future of employment: How susceptible are jobs to computerisation, they estimate that up to 66 per cent of all jobs in developing countries are at risk.
But it is high-skilled workers in advanced economies who control the plight of the low-skilled.
Currently new drugs being developed are mainly going to meet the needs of those who have money.
Oxfam says in 2014 British/Swedish pharma company AstraZeneca pulled out of all early-stage research and development for malaria and tuberculosis, and neglected tropical diseases, to focus efforts on drugs for cancer, diabetes and high blood pressure – all diseases that affect rich countries.
At the same time intellectual property rights enable those who develop technology to accumulate vast wealth, relative to those who have not.
As Oxfam points out, as changes happen rapidly, questions of which technology we focus on, who controls them and who stands to profit from them, become more important.
Governments have a big part to play in ensuring new technologies make everyone’s lives better.
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